societe des bingos du quebec inc

Transcription

AN
ECONOMIC FORCE
EVOLVING WITH BRIO OVER THE PAST 30 YEARS
Annual Report
-
THIRTY YEARS AGO, LOTO-QUÉBEC MEANT ONLY LOTTERIES.
TODAY, IT ALSO MEANS…
The Casino de Hull
The Hilton Lac Leamy
The Casino de Montréal
REGIONAL CUISINE
CONVENTION CENTRES
ENTERTAINMENT
DOGSLEDDING
Bingos
Video Lotteries
A TERMINAL NETWORK OFFERING
SECURITY, INTEGRITY AND CONTROL
REVENUES FOR NON-PROFIT ORGANIZATIONS
Loto-Québec and its 6,000 employees: an economic force evolving with brio over the past 30 years.
The Casino de Charlevoix
Fairmont Le Manoir Richelieu
ALL IN A WARM AND RELAXING ATMOSPHERE
RESORTS
AND ALSO TWO UNIQUE WINDOWS ON THE WORLD…
Ingenio
Nter
NEW TECHNOLOGIES AND GAMES
INFORMATION TECHNOLOGY SOLUTIONS
GAMING CONSULTANTS AND OUTSOURCING
LOTO-QUÉBEC – AN ECONOMIC FORCE
Over the years, Loto-Québec has become an important economic
force in Québec. The transformation of the Corporation, the
diversification of its activities, and the growth of its sales, which
reached $3.6 billion in 2000-2001, have resulted in a dividend of
$1.3 billion to its sole shareholder. In addition to the $971.3 million
in prizes paid to lottery and bingo winners, the Corporation’s
activities generate significant economic benefits in several sectors
activity and throughout Québec’s different regions. In 2000-2001,
Loto-Québec spent $433.8 million on goods and services, while its
lottery, video lottery and bingo network partners received
$452.6 million. Loto-Québec paid out $257.1 million in salaries and
benefits, $163.4 million in government taxes, and $45.8 million in
contributions to the Fonds d’aide à l’action communautaire and
other designated government accounts.
TABLE OF CONTENTS
Highlights
3
Message from the Chairman
4
The Year in Review
8
Key Figures
32
Financial Review
37
Financial Statements
39
Comparative Summary of Earnings 53
2
Corporate Structure
54
Board of Directors
55
Senior Management
55
Corporate Functions
56
Language Policy
57
Awarding of Contracts
57
Code of Ethics
58
Addresses
60
HIGHLIGHTS
HIGHLIGHTS
As at March 31, 2001
2001
127,660
729,501
160,015
117,640
643,075
132,598
% Change
5.8%
3.2
1.9
13.4
1.5
67.2
-0.3
4.3
1.8
5.0
5.9
6.4
7.5
39.7
8.5
13.4
20.7
DISTRIBUTION OF NET INCOME
in millions of dollars
3.6
(6.6)
5
4
3
2
6
2001
2000
1999
1998
1997
1
3.9
299.1
1,325.8
1,403.8
1,202.0
1,090.4
982.0
3,444.2
3,130.3
2,837.4
$ 3,444,225
1,768,224
683,461
928,412
40,433
323
66,558
913,752
18,265
2,057,480
1,325,791
1,251,000
16,348
20,240
NET INCOME
3,643.2
2001
2000
1999
1998
1997
2,619.6
TOTAL REVENUES
$ 3,643,212
1,825,528
696,471
1,053,047
41,044
540
66,355
952,674
18,600
2,160,034
1,403,758
1,330,500
17,572
28,269
464.5
Total revenues
Lottery sales
La Société des casinos du Québec inc.
La Société des loteries vidéo du Québec inc.
La Société des bingos du Québec inc.
Ingenio, filiale de Loto-Québec inc.
Resto-Casino inc.
Prizes Awarded– Lotteries
Prizes Awarded – Bingo Games
Gross Profit
Net Income
Dividends
Fonds d’aide à l’action communautaire autonome
Contributions to the Québec government
Other amounts paid to the
Québec and Canadian governments
Total assets
Shareholder’s equity
2000
639.1
(IN THOUSANDS OF DOLLARS)
1. La Société des loteries
du Québec
2. La Société des casinos
du Québec inc.
3. La Société des loteries
vidéo du Québec inc.
4. La Société des bingos
du Québec inc.
5. Resto-Casino inc.
6. INGENIO, filiale
de Loto-Québec inc.
3
MESSAGE FROM THE CHAIRMAN
2000-2001: A YEAR OF TRANSITION
In 2000-2001, the 30th anniversary of its founding, Loto-Québec set a new record
with sales of $3.6 billion, resulting in net revenues of $1.4 billion, an increase of 5.9%
over last year. The lottery sector now accounts for 50% of sales, followed by video
lotteries at 29%, casinos at 19%, restaurants at 1%, and bingo at 1%.
LOTTERIES
Sales in the lottery sector reached $1.8 billion, representing corporate net
revenues of $465 million. On-line sales rallied
this year after having been down for the past
few years, the recovery due in large part to
Super 7. Although somewhat below expectations, instant lotteries also enjoyed a good
year. The success of the sale of the first
CD-ROM, Treasure Tower, provided a better
understanding of this product, which is now
being exported to foreign markets. The launch
of a new instant lottery, Winner for Life!, also
generated a great deal of interest.
With the upgrading of the lottery
terminal network completed this year, the
new terminals are greatly facilitating the daily
operations of retailers, and will open up new commercial opportunities for LotoQuébec.
Nearly 10 million visitors, $696 million in sales, and $299 million in net
income… excellent results.
CASINOS
The Casino de Hull led the way, despite major competition from the RideauCarleton Casino and Racetrack, it maintained its position.
Moreover, the year saw the start of construction of a $228-million hotel complex
on the site of the Casino de Hull, promising to transform it into a major tourist
attraction by opening time in the fall of 2001. Operating under the Hilton banner,
the hotel has already booked 20,000 overnight stays scheduled for the next three
years and an equal number of reservations are presently in the works. An excellent
start for an excellent facility!
4
The year 2000-2001 was also a profitable one for the Charlevoix Casino, which
recorded significant increases in both attendance and net revenues in its first full year
of operations following restoration and expansion of the Manoir Richelieu and Casino
site. Efforts to attract an international clientele are beginning to bear fruit. For example,
in 2000, American visitors accounted for 15% of the Manoir's clientele, compared to
9% in 1999.
The Casino de Montréal also performed well during the past year, increasing
its net revenues by 4.3%. As well, the Cabaret enjoyed a stellar year, selling 148,000
show tickets, an increase of 32% over the previous year.
Of particular note is the fact that one in four visitors to the three casinos is from
outside Québec. In fact, during the past year alone, the Corporation invested over
$6 million in advertising to external markets.
RESTAURANTS This year, casino restaurants served over 2.3 million meals, an impressive
volume of business that did not affect either quality or service. As proof of this, both
the Le baccara restaurant in Hull and the Nuances restaurant in Montréal received a
5-diamond rating from the American Automobile Association (AAA) and the Canadian
Automobile Association (CAA/CAA-Québec), a distinction accorded to only one other
restaurant in Québec.
Video lotteries also enjoyed a successful year, posting sales of $1.053
billion and net revenues of $639 million.
VIDEO LOTTERIES
In 2000-2001, the Société des loteries vidéo du Québec issued a public call for
tenders to replace, without increasing, its existing video lottery terminal network. The
new terminals will feature the latest in advanced technology to counter compulsive
gambling.
Bingos also enjoyed another good year, with sales of $41 million and net
revenues of $3.9 million. Some $9.1 million was paid out to non-profit organizations
representing a substantial portion of their financing.
BINGOS
In September, our subsidiary, Casiloc, completed the multifunctional LotoQuébec building in Montréal and has been working non-stop on the Casino de Hull
hotel complex. The complex is one of the largest construction sites in Québec and
will require some 1.5 million work-hours.
CASILOC
INGENIO Ingenio, the subsidiary responsible for the research and development of new
multimedia products, has already concluded a number of interesting business
agreements.
As the first major product created and developed by Ingenio, the CD-ROM
lottery is acquiring international recognition and is now being marketed worldwide.
Major customers include Belgium, Switzerland, the states of Iowa and Kentucky, as
well as various Canadian provinces.
NTER TECHNOLOGIES Created
in the spring of 2000 through a joint venture between LotoQuébec and CGI Inc., Nter Technologies is focused on exporting Québec computer
expertise in the area of games of chance and money.
5
This subsidiary is currently in the process of solidifying its position with lottery
corporations in Europe and the United States.
COMPULSIVE GAMBLING Despite
all that has been said and written, I am very sensitive to
the problems faced by compulsive gamblers, and I am convinced that our
6,000 employees share my concern. It is wrong to claim that Québecers are the
biggest gamblers in Canada. In fact, they rank 8th in per capita lottery spending in
the country.
I would also like to take this opportunity to point out that Loto-Québec was
the first to propose the enactment of a law prohibiting lottery sales to minors. For
over 20 years, the Corporation has been investing, of its own initiative, in research
and the prevention of compulsive gambling. Our contributions have led to the
creation of two world-renowned Centres of Excellence at McGill and Laval universities
respectively. Since opening its first casino in 1993, Loto-Québec has pioneered
innovative prevention measures that are continuously being improved.
This year, two major advertising campaigns were launched between August 2000
and March 2001, and another awareness campaign was created with the help of Laval
University researchers, targeted at all video lottery site owners. This campaign began
in February 2001 and is still running.
In 2000-2001, we invested over $10 million in research and the prevention of
compulsive gambling, more, as far as we know, than any other jurisdiction offering
games of chance and money.
EVALUATION AND FUTURE PROSPECTS Loto-Québec
has now entered a consolidation phase.
Last September, at the Parliamentary Commission on Public Finances examining the
future direction and management of Loto-Québec operations, I clearly stated that it
would not be advisable to increase the number of games of chance and money being
offered in Québec.
Our 30th year of operations has been one of transition. Part of our current growth
is now focused on developing and exporting products and services and on attracting
tourists. In fact, Loto-Québec is firmly committed to enhancing its offerings to tourists,
thereby helping to promote Québec as a destination of choice.
During the coming years, we will be focusing our efforts on consolidating our
operations in Québec and further developing international markets for our products.
6
In closing, I would like to congratulate and express my gratitude to each and
every member of the Loto-Québec team-our 6,000 employees, 129 wholesalers,
11,411 lottery retailers, 4,085 owners of establishments offering video lottery terminals,
160 bingo hall operators, 2,000 or so non-profit organizations associated with us, and
all our other business partners who have contributed to making this year a success.
This collective effort has enabled us to pay a dividend of $1.3 billion to the
Government of Québec, thereby contributing to the financing of such key priority
sectors as health and education.
I would also like to thank the members of the Board for their excellent work,
especially Mr. Socrates Goulakos and Mr. Lorrain Audy, who have completed their
term of office with us. Finally, I would like to extend a warm welcome, to our two
new members, Mrs. Christiane Bois and Mr. Yvon Martin, and welcome back a former
member, Mrs. Francine De Montigny-La Haye.
Michel Crête
Chairman and Chief Executive Officer
7
Number of lottery retailers
11,411
Commissions paid to retailers
$124.7 M
Number of non-profit organizations operating kiosks and Lotomatique
1,058
A MAJOR BOOST FOR RETAIL BUSINESSES
LOTTERIES: DIVERSIFICATION AND NEW MARKETS
More and more, the growth of the lottery sector depends on efforts to segment
markets and diversify the client base by offering products combining pleasure and
entertainment with a certain amount of dreaming. In 2000-2001, sales for this sector
reached $1.826 billion, a $57 million increase over the previous year. Of this amount,
on-line lottery sales account for just over $1 billion, or almost 60% of all lottery sales.
8
Super 7 experienced a 28% growth, while Québec 49 maintained its gains,
supported by Double Play, which generated increased sales of 15%. The new Extra
Multiple also enjoyed an average sales growth of 5% since its launch in June.
Loto-Québec marked its 30th anniversary with the successful launch of a
$20 summer lottery, generating overall sales of $12 million and attracting mainly
occasional ticket buyers.
Pierre Martineau
Wholesaler
Boucherville
Pierre Martineau is one of the
129 wholesalers who crisscross
the various regions of Québec
every week to distribute lottery
products to the 11,411 point of
sales in our retail network.
THE YEAR IN REVIEW
Among instant lotteries, the top performers were the entertainment category's
$3 games, especially Cartes frimées (Wild Card), Cocktail d'argent (Money Cocktail)
and Pyramide (Pyramid). A new family of instant lotteries made its debut with the
launch of Gagnant à vie! (Winner for Life!), a traditional $4 instant lottery that offers
participants a chance to win $1,000 a week for life. In line with its primary objective,
this game attracted a new clientele of young adults between the ages of 18 and 34.
Also of note are the televised lottery game Décision (Decision) and the second
CD-ROM lottery, Mot Mystère (Mystery Word), which was introduced on the market
on the heels of the success of the first first game of this kind, Trésors de la Tour
(Treasure Tower).
A HIGH-PERFORMING AND COMMITTED RETAIL NETWORK
The point of sales network is made up of
11,411 retailers, with commissions paid to
these retailers reaching $124.7 million. For
the past several years, the sale of
Lotomatique subscriptions and the
management of lottery kiosks have been
entrusted to 1,058 non-profit organizations (NPOs). In 2000-2001, these longtime partners shared over $10 million in
commissions.
Throughout the year, Loto-Québec
On August 19, 2000, a group of 18 dressmakers from
Thetford Mines collected their Lotto 6/49 winning
continued its well-received awareness
prize of $10 million at Loto-Québec offices in Québec
campaign targeted at retailers, reminding
City.
them of their obligation to conform to the
law prohibiting lottery sales to minors. Administrative measures were also put into
place to deal with retailers who break the law. Repeat offenders now face sanctions,
up to and including removal of a terminal. To date, Loto-Québec has received seven
complaints, two of which required the issuance of a notice to the retailers concerned.
Our sales network enjoys the support of 129 wholesalers, incorporated as small
businesses. These wholesalers crisscross Québec to distribute and market our
products. Effective April 1, 2000, the Québec territory underwent a complete
redistribution.
Replacement of all 8,256 terminals in the system was completed as planned in
June 2000. The new V3000 terminals are equipped with touch-sensitive screens and
electronic customer displays to speed up retailers' daily operations. These terminals
also offer a range of other benefits, namely for marketing, communication and
management. Since September 2000, validation of passive and instant lotteries has
been available at the terminals 22 hours a day, from 4:00 A.M. to 2:00 A.M. the next
morning.
9
Number of hours worked on the Casino de Hull hotel complex construction site
1,500,000
Number of direct and indirect jobs created during construction
2,700
Number of work-related building and supply contracts
100
A MAJOR BOON TO THE CONSTRUCTION INDUSTRY
THREE CASINOS: THREE INTERNATIONAL TOURIST DESTINATIONS
When the government entrusted Loto-Québec with the mandate of opening casinos,
the hope was that the casinos would contribute to the economic growth of Québec
by opening up new international tourism markets, specifically through the promotion
of services already available to Québecers.
10
Loto-Québec operates three casinos - in Montréal, Charlevoix and Hull
respectively. Last year alone, close to 10 million people visited one or another of
the three casinos to play games of chance and money, to take in the shows, or to
enjoy some fine dining.
Michel Boutin
Foreman
Pomerleau Decarel
The Pomerleau Decarel joint
venture manages the new
Casino de Hull hotel complex,
construction site
a large-scale project generating
100 construction and
supply contracts.
THE YEAR IN REVIEW
In 2000-2001, Loto-Québec’s casinos generated total gaming revenues of
$696.5 million, almost 24% of these revenues came from visitors to Québec. This
tourist clientele also gave rise to economic spin-offs in direct spending other than
gambling estimated at $95.1 million combined, the casinos provide employment to
4,029 individuals.
THE CASINO DE MONTRÉAL, one of the world’s largest in terms of installations, employs
2,612 people and features 118 gaming tables, over 3,000 slot machines, a High Stakes
section, a Keno room, four restaurants (Nuances, Via Fortuna, La bonne carte and
L'entre-mise), Le Cabaret, a banquet hall, L'exécutif (an executive lounge), and indoor
parking for 2,200 cars.
The Casino de Montréal operates 24 hours a day, 7 days a week, and welcomes
an average of 17,000 visitors each day. Its gaming table and slot machine
tournaments were very popular again this year.
THE CASINO DE CHARLEVOIX employs 348 people and, together with Fairmont Le Manoir
Richelieu, plays a leading role in the development of tourism in the region. The
Casino de Charlevoix features 780 slot machines, 22 gaming tables, a High Stakes
section, a Keno room, and a bar. Its gaming table tournaments are also very popular.
Le Manoir Richelieu benefited from a dynamic marketing strategy that not only
highlighted it as a travel destination, but also promoted its year-round activities.
The 350 shows presented every year at the
Casino de Montréal continue to achieve great
success as shown by the performance of the
Cabaret which sold 148,000 tickets.
The Manoir’s golf course was widely advertised and received many visitors.
Le Manoir Richelieu has now become one of the favourite destinations of
snowmobilers and American tourists seeking winter fun in Québec, including
dogsledding. The growth in tourism from the northeastern United States is the direct
result of a huge winter advertising campaign targeted at residents of New York and
Boston.
The percentage of American visitors increased from 9% in 1999 to 15% in 2000,
and we expect this figure will reach 20% in 2001. The overall number of patrons
from outside Québec doubled from 17% in 1999 to 24% in 2000.
THE CASINO DE HULL employs 1,005 people and features 55 gaming tables, 1,410 slot
machines, a Keno room, three restaurants (Le baccara, Banco and Le Café),
two bars, a banquet hall, a private salon, and an area for local artists to exhibit their
works. Currently under expansion, the casino has become a tourist magnet for the
region. This major construction project, which began last fall, will house a 350-room
hotel, a convention centre, a theatre, and a golf course.
11
The Casino de Charlevoix and Fairmont
Le Manoir Richelieu represent a major tourist
attraction for the ever-growing American
tourist clientele.
THE YEAR IN REVIEW
RESTO-CASINO: SERVING OVER 2 MILLION MEALS ANNUALLY
Operated by our subsidiary, Resto-Casino, casino restaurants employ 672 people
in Montréal, 319 in Hull, and 26 in Charlevoix, for a total of 1,017. Each year, over
two million meals are served, requiring expenditures of $23 million for a wide range
of supplies.
Through its extensive expertise, Resto-Casino provides high-quality hotel and
restaurant services, greatly adding to the enjoyment of the visitors to our
entertainment establishments. Whenever possible, casino restaurants use seasonally
available local produce. Restaurant
revenues account for over $66 million. In
fiscal 2000-2001, Resto-Casino was entrusted with the added responsibility of
managing and operating the new hotel
under the Hilton banner and convention
centre in the Hull complex.
Mr. Alain Labrie, Executive Chef of l'Auberge Hatley,
Mr. François Hanchay, Executive Chef of the Casino
de Hull, and Mr. Jean-Pierre Curtat, Executive Chef of
the Casino de Montréal, officially receiving their
"five-diamond" distinction from the AAA and
CAA/CAA-Québec.
RESTAURANTS OF DISTINCTION Le baccara at the
Casino de Hull and the Nuances at the
Casino de Montréal were honoured with
the prestigious “five-diamond” distinction
from the American Automobile Association (AAA) and the Canadian Automobile
Association (CAA/CAA-Québec).
These restaurants have succeeded in
drawing such internationally renowned
chefs as Italy’s Frédéric Bourse, Rémy
Giraud from Val-de-Loire, and Parisian Thierry Breton. Casino gastronomy is
achieving a reputation for excellence outside Québec.
On November 4, 2000, Casino de Hull chef François Hanchay also received
the President's Trophy, awarded by the Canadian Federation of Chefs for his overall
contribution to the profession.
12
Number
Number of
of meals
meals served
served during
during the
the year
year
2,300,100
Quantity
Quantity of
of meat
meat purchased
purchased in
in kilograms
kilograms
491,000
Number
Number of
of creamers
creamers purchased
purchased from
from the
the industry
industry
7,830,000
A MAJOR BOON FOR THE FOOD INDUSTRY
Robert Tanner
Canam Fruits and Vegetables Inc.
St-Laurent
Canam Fruits and Vegetables Inc.
is one of the many food industry
suppliers that share in the
$10.5 million of purchases made
by Resto-Casino.
Casino de Montréal chef Jean-Pierre Curtat was honoured with the 2000
Gastronomy Star awarded by Charton Hobb's, ambassador and importer of superior
quality brands, and was named Chef of the Year. Chef Curtat also participated in a
culinary demonstration organized by the agriculture ministers of several countries
at the Casino de Catalogne in Spain. This event provided an excellent opportunity
to showcase Québec products. More and more, the casino restaurants are playing
an important role in disseminating our corporate image and bringing various client
groups together.
13
Amount
Amount distributed
distributed to
to bingo
bingo hall
hall operators
operators
$2.3 M
Amount
Amount distributed
distributed to
to non-profit
non-profit organizations
organizations
$9.1 M
Number
Number of
of bingo
bingo hall
hall operators
operators
160
A MAJOR BOOST FOR NON-PROFIT ORGANIZATIONS
BINGO: REVITALIZING A POPULAR GAME
The traditional bingo sector is an important source of funding for hundreds of nonprofit organizations (NPOs). This sector generates sales of approximately $275
million, including $41 million for network products marketed by the Société des
Bingos du Québec (SBQ).
14
At the close of its third year of operations, the SBQ posted sales of $41 million
and a profit of $13 million. In accordance with the partnership established in 1997,
$9.1 million of this net profit was distributed to NPOs – $8.2 million to the
735 non-profit organizations whose bingo games are held in halls connected to the
network and $931,000 divided among those non-profit organizations whose bingo
events are held in non-participating halls.
Claude Bougie
Owner-Representative of
Pointe-aux-Trembles Bingo
Claude Bougie is the ownerrepresentative of Pointe-auxTrembles Bingo, one of the halls
linked to the Société des
bingos du Québec’s on-line
network.
THE YEAR IN REVIEW
At the request of stakeholders, reforms are under way to increase the level of
funding to NPOs and to ensure tighter controls. On December 20, 2000, the
Government approved a series of measures aimed at improving the situation.
Based on extensive consultations with NPOs, these measures propose sharing
responsibilities between the various stakeholders, including the SBQ, in order to
take full advantage of the SBQ’s expertise and re-energize the sector. This would
entail putting tighter controls into place as part of a restructuring plan for the
industry.
To do this, the mandate of the SBQ will
be modified. Improved management of bingo
halls and a greater variety in the games being
offered are two keys to revitalizing the
industry and achieving the primary goal of
increasing NPO revenues for the financing of
their philanthropic work.
The SBQ currently offers three bingo
products daily: one in the evening, Le Grand
Tour; one in the afternoon, Le Petit Tour, and
an optional Keno-type game, Éclair, added
in 1999.
Mrs. Micheline Asselin is President of Bingo
communautaire de l’Est and CEO of La Maison
Again this year, the SBQ has led the way
Dalauze, a non-profit organization that is
with initiatives aimed at energizing bingo in
funded in large measure thanks to bingo
activities.
Québec through active promotion of the
game. The Corporation has advertised participating halls and, in collaboration with its partners, offered clients a wide array of
entertainment. Among the initiatives generating great interest was Bingo Show III
with Michel Louvain. Bingo Show events have succeeded in reaching all their goals,
generating a 110% increase in attendance, a 179% increase in sales, and generally
boosting the popularity of bingo among the public at large.
15
Number
Number of
of licensed
licensed video
video lottery
lottery establishments
establishments
4,085
Number
Numberof
ofterminals
terminals
15,251
Amount
Amountpaid
paidto
toretailers
retailers
$315.9 M
A MAJOR BOOST FOR SMALL AND MEDIUM-SIZED BUSINESSES ACROSS QUÉBEC
16
VIDEO LOTTERIES: GREATER SECURITY AND CONTROL
At March 31, 2001, the Société des loteries vidéo du Québec (SLVQ) had recorded
revenues of $1.053 billion and a net profit of $639.1 million, a 15.7% increase over
last year. This growth in the performance of video lottery games, which depend on
cutting-edge technology, was the result of tight management of the network of
terminals and of a strong partnership between the SLVQ, its 40 employees and
private sector partners. These partners, who manage a large part of daily video
lottery operations, represent a yearly investment by the SLVQ of some $16 million
in business contracts and agreements, thus contributing to economic activity across
Québec and to the creation of permanent jobs in the regions.
Spiro Markessinis
Owner
Restaurant Deli 500
Spiro Markessinis' restaurant is
one of the 4,085 licensed
establishments that are partners
of the Société des loteries
vidéo du Québec.
THE YEAR IN REVIEW
At the end of fiscal 2000-2001, the network had 15,251 terminals in
4,085 establishments licensed by the Régie des alcools, des courses et des jeux, or
one terminal per 484 persons – one of the lowest rates in Canada. For the last six
years, the number of terminals, as well as the number of establishments within the
network, has remained substantialy unchanged.
Throughout the year, the SLVQ has
continued to fine tune the computerization of
its terminal network, as well as its procedures
for sharing information, billing, maintenance,
stock management and security. The SLVQ also
launched a public call for tenders to replace its
network of video lottery terminals. These
terminals are showing signs of wear and tear
and the goal is to equip the new terminals with
improved controls and player awareness
mechanisms. The replacement of the entire
network of terminals will be completed
in 2002.
SOCIAL RESPONSIBILITY The SLVQ, in collaboration
with Laval University’s Centre québécois
d’excellence pour la prévention et le traitement
The network of 15,251 video lottery terminals
in Québec will be replaced in 2002.
du jeu, offers retailers information sessions on
compulsive gambling. The purpose of this
initiative is twofold: to ensure that retailers have the necessary information at their
disposal so as not to perpetuate the myths generally associated with gaming
activities, and to enable them to more readily identify true compulsive gamblers –
the 2.1% of the population who have a gambling problem at one time or another
in their life – so that they can help these individuals if the need arises. The SLVQ
expects that all retailers will have attended an information session by 2002.
17
THE YEAR IN REVIEW
INGENIO: INNOVATION IN ACTION
Since its creation two years ago, Ingenio, the newest of Loto-Québec’s
subsidiaries, has found a unique niche for itself within the lottery industry. A
product of Loto-Québec’s research and development
and backed by the head office’s solid reputation as a
world leader in the field of gaming and lotteries,
Ingenio has quickly made its mark.
Its work has generated international interest due
to the quality of its achievements:
an international patent, the launch
of two CD-ROM games in the
Québec market, their adaptation for
foreign use (including into German
and Dutch) five awards of distinction (including four at the international level), and several
concepts currently under development – an impressive record
for a team of just 36 employees
comprised of supernumeraries,
contract employees and freelancers.
Graphics created for
Ingenio products such as
Mystery Word, help
promote Québec's
multimedia expertise.
To achieve this, Ingenio has
relied almost exclusively on Québec
multimedia expertise. Products such
as Treasure Tower and the
multimedia production of Mystery Word, are the result of
this close collaboration and the international success of
these products is helping to showcase Québec know-how
in this highly specialized field.
Ingenio’s customers are part of a worldwide network of
180 public lottery corporations. An essential part of its work consists in guiding
these corporations through a transition process that involves a new clientele
and new tools that are unfamiliar to them. Discussions are currently underway
with the French National Lottery, for example, to develop new gaming concepts.
18
A LOTTERY FOR EVERY MARKET Ingenio holds full ownership rights on its creations
and offers turnkey gaming solutions based on concepts that can be adapted to
most markets. Its marketing strategy is simple: to offer the most original
multimedia products developed for occasional adult players. In so doing,
Ingenio relies on universal technology that can be integrated smoothly into the
existing distribution networks of conventional lotteries.
Value of contracts awarded to Québec multimedia firms
$494,073
Number of Ingenio multimedia business partners
7
A MAJOR BOON TO THE MULTIMEDIA INDUSTRY
Luc Larouche (left)
President
Alain Limouzin
CEO
Les Studios Sidecity Inc.
Les Studios Sidecity is one of
the many Québec-based
multimedia firms that
collaborate with Ingenio in
developing new products.
In October 2000, Treasure Tower generated a flurry of interest in Europe
when French, German and Dutch CD-ROM versions of the game were added
to the panoply of lotteries operated by the Belgium National Lottery. One month
later, the Iowa State Lottery successfully embarked on the CD lottery adventure,
marking the American debut of Treasure Tower. Additional agreements have
been reached for upcoming CD launches in other U.S. states, Canadian
provinces, as well as in Switzerland.
19
THE YEAR IN REVIEW
NTER TECHNOLOGIES: EXPORTING KNOW-HOW
Nter Technologies is a joint venture of Loto-Québec and CGI Inc. Thanks to this
co-operative partnership, unique solutions are now being made available to gaming
corporations around the world.
The complete and immediate synergy of these two companies has allowed
Nter to gain a firm foothold in the European and American markets in its very first
year of operation, with the company now receiving calls for tenders for casino
management systems, televised game
concepts, and the launch of lottery games. At
the end of its first fiscal year, Nter has recorded
a profit, owing in large part to the talent and
dedication of its 181 employees.
Nter Technologies' mission is to become
a world leader recognized for its integrated
and innovative services. By relying on the
quality, creativity, innovation and evolution of
cutting-edge technologies, Nter hopes to
significantly help extend Québec know-how
on the international scene.
Mr. Simon Brodeur, President and Chief
Executive Officer of Nter Technologies,
pictured here with Mr. Gaétan Roy, Executive
Vice-President, Information Technology.
To achieve this goal, Nter is offering the
following products and services:
• a complete management system for on-line
lottery games adapted to modern technologies
and designed for durability, integrity, performance, security and reliability
• specifically-developed applications for the casino, bingo and video lottery sectors
• consulting services in business development and marketing
• operational set-up of chance and money games
Since its creation, the new enterprise has undertaken the task of designing an
entirely new and sophisticated system of lottery management to meet Loto-Québec’s
future needs. This integrated, innovative and flexible solution will most certainly
have star billing among the products marketed internationally by Nter Technologies.
20
THE YEAR IN REVIEW
CASILOC: EFFECTIVE REAL ESTATE MANAGEMENT
Casiloc, our subsidiary responsible for real estate project management, acquisitions
and leasing of casino facilities, saw a significant increase in its activities in 20002001, having become one of the major suppliers of work in Québec, while
contributing to the local construction industry’s reputation for excellence and
efficiency.
Once the Casino de Hull hotel complex opens, Casiloc will have managed
eight large projects since 1993, representing a combined value of $820 million and
an average of more than $100 million a year.
At the end of September 2000, Casiloc
completed the Loto-Québec multi-purpose
complex located at the corner of Mill and
Bridge Streets in Montréal. The 22,000 ft2
complex, whose construction generated over
500,000 hours of work, includes five
warehouses, numerous workshops, the
Corporation’s archives, several training rooms,
and houses the first 24-hour daycare centre
in Québec for the children of Casino de
Montréal employees.
In fiscal 2000-2001, Casiloc also moved
forward with construction of the Casino de
Hull hotel complex.
The daycare centre of the Mill Street multipurpose complex in Montréal was the first in
Québec to operate 24 hours a day,
7 days a week.
When completed, this $228-million
urban resort complex will include a 350-room hotel operated under the Hilton
banner, a 2,200 m2 convention centre with room for 1,800 people, a 1,000-seat
theatre, and a golf course.
Work is progressing on schedule, with the hotel, convention centre and theatre
set to open at the beginning of fall 2001, the golf course will be inaugurated at a
later date.
The Casino de Hull hotel complex is one of the largest construction sites
currently in Québec. It will require more than 1,500,000 work-hours and provide
construction and supply contracts to more than 100 businesses and supply
companies.
21
Number of cheques issued this year to lottery winners
33,174
Number of works of art acquired by the Loto-Québec Collection
2,200
Number of events sponsored for the benefit of the Québec population
Photo: Bernard Brault, La Presse
171
A MAJOR IMPACT ON ACCESS TO CULTURE AND ENTERTAINMENT
COMMUNICATIONS: EXPANDING LINKS WITH THE COMMUNITY
The Corporate Communications and Public Affairs Vice-Presidency conducts draws,
greets and pays winners, responds to requests for information from the public and
the media, and establishes links with the community through sponsorships and the
promotion of works of art included in the Loto-Québec Art Collection.
Daily draws are conducted in an atmosphere of complete
transparency and credibility by a team highly trained in the proper procedures. In
addition to the hundreds of regular draws, the broadcast of televised games requires
close collaboration between the Loto-Québec team and external auditors.
Consistently high ratings confirm the popularity of these televised draws, and France
and other countries are now adopting the same formula.
TRANSPARENT DRAWS
22
Charles Dutoit
Artistic Director
Montréal Symphony Orchestra
The Montréal Symphony
Orchestra has been giving free
concerts in Québec parks for
many summers thanks to the
contribution of Loto-Québec
sponsorships.
THE YEAR IN REVIEW
$300 MILLION IN CHEQUES Some
$300 million in prize money from draws was claimed
at our Montréal and Québec City offices in prizes of all sizes. In 2000 alone,
48 cheques of $1 million or more were issued, not counting the $15 million won
by a resident of Saint-Constant.
A POPULAR WEB SITE Started
up in 1996, Loto-Québec’s Web site is among the 10 most
visited Québec sites on the Internet. In March 2001, the site registered a record
number of 914,000 visits, up 66% from last year and fuelling expectation that there
may soon be more than a million visits a month.
SPONSORSHIP SUPPORT Through a far-reaching
sponsorship program, organizing committees
of some 100 socio-cultural, artistic and
sporting events across Québec receive a
helping hand to make their events more
accessible to the public.
Montréal is the beneficiary of important
sponsorship support for the Air Canada Grand
Prix and the Just for Laughs Comedy Festival.
In fact, Loto-Québec contributions enable the
comedy fest to put on 2,000 free street shows.
The Corporation’s sponsorship dollars also
The press conference announcing the Casino
help offset the cost of the Montréal Symphony
de Hull hotel complex construction project
Orchestra’s summer concerts in the parks and
was held in the presence of Mr. Bernard
Landry, current Premier of Québec, and
support other symphony orchestras as well,
Mr. Michel Crête, Chairman and Chief Executive
including those of Lac-Saint-Jean, Sherbrooke,
Officer of Loto-Québec.
Trois-Rivières, Laval and Québec City. In
addition, Loto-Québec serves as a major sponsor of la Soirée des Masques and the
Mosaïcultures internationales de Montréal.
A UNIQUE COLLECTION OF CONTEMPORARY ART For the past 22 years, the Loto-Québec Art
Collection has helped to promote Québec artists, to stimulate local creativity through
the acquisition of works of art, and to encourage the exposure and recognition of
talented Québecers. With the latest addition of 200 new items, the Collection now
includes 2,200 works by 650 Québec artists.
Since 1979, Loto-Québec has invested more than $2.9 million in Québec art.
In order to allow the public to enjoy the jewels of this collection, exhibitions were
held this past year at the Centre d'Art d’Orford and the Musée d'Art de Saint-Laurent.
23
THE YEAR IN REVIEW
HUMAN RESOURCES: ASSURING TRAINING AND QUALITY OF LIFE
The Corporate Human Resources Vice-Presidency oversees a broad range of
operational, consulting and developmental services designed to meet the strategic
objectives of all areas of the Corporation’s activities.
An important focus of Human Resources is training and development.
Daycare centres have been set up under the aegis of Small Children Centres for
children of employees of the casinos in Montréal and Hull, corporate head office
on Sherbrooke Street, and the multi-purpose complex on Mill Street. Two of these
daycare centres are open 24 hours a day,
7 day a week – a first in Québec.
Among its other initiatives, Human
Resources issued a Corporation-wide
training and development policy to
promote the professional and academic
advancement of employees. For example, a training program has been set up
in the casinos, involving over 80 trainers
working on-site.
During the past year, considerable
effort was devoted to reviewing and
The training program for croupiers offered at the
consolidating the various elements of the
multi-purpose complex on Mill Street in Montréal is
among Loto-Québec’s many employee development
current framework of policies, programs
activities.
and processes and identifying training
opportunities tied in with phase one of the rebuilding plan.
Because training is a constant concern, an amount equal to 2.8% of global
salaries across the Corporation was earmarked to train some 6,000 employees.
Moreover, in the past year, over 7,100 candidates showed an interest in the
86 jobs posted. As a result, 73 positions were filled.
The signing of a 5-year collective agreement with the union of Loto-Québec
employees marked a key point in labour relations. Significant efforts were made
24
Salaries
Salaries and
and benefits
benefits paid
paid to
to our
our employees
employees
$257.1 M
Number
Number of
of employees
employees who
who received
received training
training during
during the
the year
year
3,646
Number
Number of
of children
children in
in our
our daycare
daycare centres
centres
214
A MAJOR IMPACT ON EMPLOYEE QUALITY OF LIFE
Bountheung Sombounsing
Educator
Casinours
Casinours is a daycare centre
that provides a permanent
service to parents working at
the Casino de Montréal,
enabling them to better balance
their family life and work
schedule.
to review and consolidate portions of the group insurance and retirement plans
through various consultations with the representatives of the 15 unions within
the Corporation.
The occupational health and safety policy was also updated, which should
greatly improve how the program is managed.
25
THE YEAR IN REVIEW
INFORMATION TECHNOLOGY: SECURITY AND DEVELOPMENT SUPPORT
The Information Technology Vice-Presidency operates and develops the lottery and
lottery management systems and advises senior management on advances in support
systems for business operations.
RELIABILITY
In fiscal 2000-2001, the overall availability rate of lottery systems was
99.94%.
Over 458 million transactions were processed during this period, setting a new
record for a single year.
Developing new products and maintaining existing lotteries in the
information technology sector require vast resources to ensure that our rigorous
standards of quality and integrity are met. Technical support is provided for both
lottery products, such as Extra Multiple, Double Jeu and Banco Spécial, and the
casino sector for which the new Mega Keno and on-line Keno were developed.
DEVELOPMENT
The deployment of V3000 lottery terminals and the move to digital technology
for network transmission of gaming data were completed as planned. The new
generation of terminals has brought about major improvements in the quality of the
printing of lottery tickets. This large-scale project was made possible with the
participation of Québec companies that manufactured and installed the terminals
and made improvements to the telecommunication network.
The method used to broadcast draw results received a mention in the security
category at the first e-commerce gala held on November 20, 2000, at the Casino de
Montréal’s Cabaret. Using the Internet, this computer application provides
information outlets such as newspapers, radio and television with secure access to
draw results, while guaranteeing the integrity of the data.
RENEWING GAMING SYSTEMS Projects
to renew gaming platforms and lottery management
were also initiated during the past year.
For example, the ServerNet project is specifically aimed at modernizing the
Corporation’s computers and operating software. This will result in systems that
perform better, respond faster, and adapt more readily to changing needs.
26
THE YEAR IN REVIEW
FINANCE AND ADMINISTRATION: ENSURING STRICT CONTROL
The large volume of sales and wide variety of activities carried out by the
Corporation demand strict administrative and financial procedures. The Corporate
Finance and Administration Vice-Presidency is responsible for providing the
appropriate operational support and controls required.
In the area of procurement, the purchase
of goods and choice of suppliers are determined with transparency and integrity in
accordance with precise rules. While always looking for the best quality/price ratio
to meet the required standards of efficiency, the Corporation favours buying madein-Québec goods and encourages the development of Québec companies.
Throughout the year, Loto-Québec scrupulously applied existing policies in awarding
contracts.
TRANSPARENCY IN THE AWARDING OF CONTRACTS
Over the past year, Finance and Administration was kept particularly busy with
several projects, including ORACLE, a new integrated financial software package.
The new program will replace a dozen or so systems dating back to the 1980s that
were no longer meeting the Corporation’s needs. As well as providing access to a
database that provides complete and integrated information, the new technology
will solidify the Corporation’s move into e-commerce.
Finally, Building Services welcomed 280 casino and lottery employees to their
new premises in the multi-purpose complex on Mill Street.
27
THE YEAR IN REVIEW
CORPORATE AFFAIRS: DISPENSING BROAD LEGAL EXPERTISE
The Corporate Affairs Vice-Presidency is comprised of three departments: Legal
Affairs, the Office of the Corporate Secretary, Research and Prevention and
Compulsive Gambling. Corporate Affairs has an important role to play, offering legal
and secretariat expertise and ongoing support to the various spheres of activity
sectors within the Loto-Québec Group.
This past fiscal year, Corporate Affairs took part in several major decisions,
including the purchase and leasing of real estate for the Casino de Hull hotel
complex, the signing of agreements governing the 24-hour operation of the two
daycare centres, and the establishment of Nter Technologies, created in partnership
with CGI Inc. In cooperation with the Office de la langue française, Corporate Affairs
also developed and adopted a language policy to be applied throughout LotoQuébec and its subsidiaries.
Moreover, during fiscal 2000-2001, Corporate Affairs was actively involved in
the preparation of documents used during the Parliamentary Commission held in
September 2000 which conducted a review of the activities of Loto-Québec and its
subsidiaries. In addition, Corporate Affairs is responsible for obtaining all patents
and trademarks required for the protection of the Corporation’s intellectual property
internationally, as well as for granting licenses to market products worldwide.
Along with executing mandates related to Loto-Québec’s current activities,
Corporate Affairs manages a documentation centre that houses more than
2,400 books and an impressive collection of gaming magazines and serves as a rich
source of information for lottery corporations around the world.
COMPULSIVE GAMBLING: INCREASED FOCUS ON PREVENTION
For over 20 years, Loto-Québec has been pro-active in supporting scientific research
into the prevention of compulsive gambling, committed to raising public awareness
of the problem. In 2000-2001, the Corporation invested more than $10 million
towards this end.
A highpoint of last year was the National Assembly’s adoption in February 2000
of a law prohibiting lottery sales to minors, an initiative first proposed by LotoQuébec. The Corporation adopted a series of measures to support the law, aimed
specifically at wholesalers, retailers and consumers. New administrative procedures
were also implemented, outlining sanctions to be taken against retailers who do not
comply with the law.
28
THE YEAR IN REVIEW
The application of these measures was
accompanied by an extensive advertising campaign targeted at the general public
to inform Québecers of the new legislation. The messages were carried on television,
in newspapers, and on billboards.
BROAD-BASED ADVERTISING CAMPAIGNS
This was followed by a second, more general campaign reminding the public
that games of chance and money are reserved for adults only and encouraging them
to play with moderation. Loto-Québec added a third, more direct campaign to
promote a telephone Help Line for individuals who may show signs of compulsive
gambling.
TARGETED PROGRAMS In addition to the contributions made to the Ministry of Health
and Social Services, Loto-Québec also continued to subsidize several prevention
and treatment programs for compulsive gamblers.
The information and educational program, Count Me Out, created for
adolescents and presented in schools, was already in its third year and underwent
changes midway through 2000.
Spokespersons for the English advertising
campaign publicizing the Help Line.
In 2000-2001, Loto-Québec increased its financial support to the Gaming Help
and Referral telephone hot line. This service is now available 24 hours a day, 7
days a week, and provides dedicated support from professional experts.
An interactive terminal service was also set up in the Hull and Charlevoix
casinos. This animated program is based on a concept that allows players to
recognize and assess their own behaviour in dealing with games of chance and
money. These terminals have been in place at the Casino de Montréal since 1999.
To date, more than 25,000 people have taken advantage of the service.
Additional improvements were made to self-exclusion programs in each of the
three casinos. As of March 31, 2001, some 3,331 self-exclusion contracts were in
force. These contracts allow players to exclude themselves voluntarily from casinos
for periods ranging from six months to five years.
In accordance with measures announced in the last
budget speech, management of all research and public awareness programs has
been transferred to those Ministries and Government organizations which have
primary responsibility for these areas. As a result of this decision, an amount of
$18 million will be transferred on a yearly basis to the Québec Ministry of Health
and Social Services for research into compulsive gambling and for prevention and
treatment. An additional $2 million will be allotted to the Ministry of Public Security
to assist it in meeting its mandate. In addition to this financial contribution, the
Corporation will continue to show its concern and commitment by acting as a good
corporate citizen and by being ever more vigilant in its operations and with its
products, focusing on its clientele, its sales network, and its workforce.
A NEW APPROACH FOR THE FUTURE
29
THE YEAR IN REVIEW
SENIOR MANAGEMENT: PLANNING, CONTROLLING AND MONITORING
Three specific corporate functions are the responsibility of senior management and
serve to support the overall operations of the Corporation.
STRATEGIC PLANNING Working
in close collaboration with all sectors of activity, Strategic
Planning oversees the preparation, updating and follow-up of the corporate plan
and the operational plans of the subsidiaries and Vice-Presidents’ offices. Strategic
Planning also maintains up-to-date information on gaming expenses, market trends
and gaming products, particularly in Canada and the United States.
Last year, Strategic Planning joined senior management in redefining the
Corporation’s objectives for the next few years.
CORPORATE SECURITY At
Loto-Québec, integrity and security are fundamental values that
the Corporation is committed to applying at all levels. To achieve this, Corporate
Security has developed security standards and procedures for each of Loto-Québec’s
facilities and operations of Loto-Québec and those of its subsidiaries and maintains
control over these standards. Corporate Security also establishes, coordinates and
follows up on preventative measures and plans of action. During the past fiscal year,
its efforts were focused primarily on two key areas – physical safety and computer
security – in order to provide Loto-Québec with the highest level of security possible,
while ensuring that operations can carry on in the event of a disaster
INTERNAL AUDIT Internal Audit also has major responsibilities for protecting the integrity
and credibility of Loto-Québec’s reputation and is charged with ensuring the smooth
operation of all systems used by the Corporation and its subsidiaries.
Employing a work plan based on risk assessment and approved by the Board
of Directors' Audit Committee, Internal Audit experts conduct periodic inspections
of all control systems, particularly in sensitive areas.
In fiscal 2000-2001, management also paid particular attention to new
technologies and their effective integration into the Corporation’s systems.
30
THE YEAR IN REVIEW
LOTIM: HEAD OFFICE MANAGEMENT
Lotim Inc., another subsidiary of Loto-Québec, is a 50/50 owner with SITQ
Immobilier, a subsidiary of the Caisse de dépôt et placement du Québec, of the
building located at 500 Sherbrooke Street West in Montréal which houses the
Corporation’s head office.
Over the past few years, the occupancy rate in this facility has gone up
significantly, reflecting the current economic growth in Québec and the dynamic
rebirth of Montréal.
By the end of fiscal 2000-2001, there was no space available for rent. The two
restaurants and other businesses operating in the building have been taking full
advantage of the increase in customer traffic.
As a result, returns were up slightly from last year, with net operating revenues
generated by the building growing from $3.2 to $3.4 million, a 5.5% increase as
compared with 1999.
31
KEY
FIGURES
LOTO-QUÉBEC
NO. OF EMPLOYEES
Lotteries/
Corporate
Categories
Management
Professionals
Technicians
Office staff
Multimedia design/representatives
Total
96
202
130
254
–
682
La Société des
loteries vidéo du
Québec inc.
La Société
des bingos
du Québec inc.
Ingenio,
filiale de
Loto-Québec inc.
4
7
5
7
1
24
4
2
3
7
20
36
11
9
8
12
–
40
NO. OF EMPLOYEES
Management
Operations management
Professionals
Technicians
Gaming staff
Office support staff
General support staff
Total
Société des
casinos
Casino de
Montréal
Casino de
Charlevoix
Casino de
Hull
Resto-Casino
Montréal
Resto-Casino
Hull
Hilton
Lac Leamy
9
–
13
10
–
20
12
64
427
–
22
173
1,024
432
534
2,612
41
–
4
30
113
65
95
348
190
–
17
114
348
194
142
1,005
17
36
4
1
–
18
596
672
4
22
1
4
–
24
264
319
9
–
5
–
–
3
–
17
LA SOCIÉTÉ DES CASINOS DU QUÉBEC INC.
CASINO ATTENDANCE AND REVENUES
(NUMBER OF VISITORS IN THOUSANDS)
Montréal
Markets
Local clientele
Tourist clientele(1) from Québec
Tourist clientele from outside Québec
Total
Hull
Charlevoix
Total
4,387.4
851.7
364.2
5,603.3
770.3
342.7
1,919.6
3,032.6
56.6
950.0
41.9
1,048.5
5,214.3
2,144.4
2,325.7
9,684.4
454.8
13.6
468.4
74.4
114.2
188.6
38.1
1.4
39.5
567.3
129.2
696.5
20.9
20.5
41.4
3.3
23.7
27.0
26.3
0.4
26.7
50.5
44.6
95.1
(IN MILLIONS OF DOLLARS)
Contribution to gaming revenues
Local and tourist clientele from Québec
Total
32
Contribution to tourism balance(2)
(direct expenditures other than gaming)
Tourist clientele from Québec
Total
(1) Casino clientele from more than 80 kms away (based on Statistics Canada definition)
(2) Based on assumptions made in the study of SCQ economic spin-offs by Yves Rabeau, September 1997
Source: Société des casinos du Québec inc.
KEY
FIGURES
RESTO-CASINO INC.
RESTO-CASINO ECONOMIC IMPACT STATISTICS
(IN THOUSANDS OF DOLLARS) for the year ended March 31, 2001
SALES
Montréal
Food
Beverages
Cigarettes
Baskets and promotional items
Discounted items and others
$
$
$
$
$
$
20,884
18,575
247
5,034
50
44,790
Number of meals served (including employees’ cafeteria)
Number of drinks served from juice bars
Number of club sandwiches sold
Number of buffet meals sold
Average sales per casino visitor – restaurants
Average sales per casino visitor – bars
1,619,300
6,797,700
13,800
186,900
$
3.66
$
0.56
Charlevoix
$
$
$
$
$
$
29
1,282
73
–
–
1,384
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
Hull
$
$
$
$
$
$
Total
8,182
9,415
159
2,392
33
20,181
$
$
$
$
$
$
29,095
29,272
479
7,426
83
66,355
661,800
3,764,200
10,800
144,000
$
2.57
$
0.66
2,281,100
10,561,900
24,600
330,900
$
3.28
$
0.60
$
$
PURCHASES
Food
$
Meat (in kg),
including smoked meat (in kg)
Fish (in kg)
Tomatoes (no. of cans)
Beverages
Beer (bottles)
Wine (bottles)
Single serving cups of cream (units)
Cigarettes
Baskets and promotional items
Dishes, cutlery, glasses and small equipment
Disposable items
Linen and uniforms
Maintenance and cleaning products
Other (menus, flowers, etc.)
7,681
$
331,000
45,600
81,700
29,800
$
3,975
19
n.a.
n.a.
n.a.
n.a.
$
391,000
89,200
5,430,000
226
2,869
160,000
1,200
42,000
6,000
$
n.a.
n.a.
n.a.
1,708
10,569
491,000
46,800
123,700
35,800
$
255,000
34,000
2,400,000
5,909
646,000
123,200
7,830,000
$
$
$
$
$
$
$
$
249
2,517
444
508
501
530
197
16,602
$
$
$
$
$
$
$
$
61
–
10
11
1
6
3
337
$
$
$
$
$
$
$
$
160
712
166
223
183
189
120
6,330
$
$
$
$
$
$
$
$
470
3,229
620
742
685
725
320
23,269
$
215
$
3
$
196
$
414
$
$
289
504
$
$
20
23
$
$
229
425
$
$
538
952
$
19,686
$
519
$
9,694
$
29,899
OTHER EXPENSES
Sales expenses (including commissions and credit cards)
Administrative expenses (including legal fees,
stationery and training)
SALARIES AND BENEFITS
No. of employees
672
26
319
1,017
33
KEY
FIGURES
LOTTERIES
COMMISSIONS PAID TO RETAILERS
(in millions of dollars)
1996-1997
1997-1998
1998-1999
1999-2000
2000-2001
104.8
107.7
114.0
121.3
124.7
DISTRIBUTION OF RETAILERS AND TERMINALS BY REGIONAL CENTRE
No. of retailers
%
No. of terminals
3,755
3,966
3,690
11,411
32.9
34.8
32.3
100
2,785
2,860
2,611
8,256
33.7
34.6
31.7
100
No.
%
5,169
2,052
1,129
1,682
795
78
139
367
11,411
45.3
18.0
10.0
14.8
7.0
0.7
1.2
3.0
100
Montréal and Northwestern Québec
Montréal and Southeastern Québec
Eastern Québec
Total
%
DISTRIBUTION OF RETAILERS BY TYPE OF BUSINESS
Tobacco and convenience stores
Grocery stores
Financial institutions
Other service outlets
Drug stores
Travelling salespeople
Booths
Others
Total
34
KEY
FIGURES
LOTTERIES
Sales in
thousands of dollars
2000-2001 1999-2000
ONLINE LOTTERIES
Lotto 6/49
Super 7
Québec 49
Extra
Banco
La Quotidienne
Subtotal
%
change
Prizes awarded in
thousands of dollars
2000-2001 1999-2000
%
change
461,956
243,586
64,797
156,456
107,560
25,829
1,060,184
465,440
189,694
61,909
142,882
109,863
24,514
994,302
-0.7
28.4
4.7
9.5
-2.1
5.4
6.6
220,478
141,946
30,455
69,861
52,705
11,623
527,068
218,771
106,654
29,098
63,799
53,835
11,032
483,189
0.8
33.1
4.7
9.5
-2.1
5.4
9.1
579,974
11,164
591,138
554,809
9,883
564,692
4.5
13.0
4.7
318,006
5,861
323,867
303,888
5,188
309,076
4.6
13.0
4.8
TELEVISED LOTTERIES
Instant televised lotteries
Teleactive games
Subtotal
41,525
42,669
84,194
69,193
46,168
115,361
-40.0
-7.6
-27.0
24,959
25,723
50,682
42,014
28,093
70,107
-40.6
-8.4
-27.7
TRADITIONAL LOTTERIES
Mini
Special editions
Subtotal
14,894
32,771
47,665
16,852
31,495
48,347
-11.6
4.1
-1.4
6,555
17,817
24,372
7,416
15,697
23,113
-11.6
13.5
5.4
42,347
1,825,528
45,522
1,768,224
-7.0
3.2
26,685
952,674
28,267
913,752
-5.6
4.3
INSTANT LOTTERIES
Regular and entertainment-type
CD lottery
Subtotal
SPORTS BETTING
TOTAL
35
KEY
FIGURES
LA SOCIÉTÉ DES BINGOS DU QUÉBEC INC.
SALES BY REGION
Average no. of
participating
Halls
No.
of events
Approx. No. of
participating
NPOs(*)
Net
sales
Commissions
paid to
operators
574,529
$
REGION
Lower St. Lawrence
7
1,103
Québec City/North Shore
Chaudière, Appalaches,
24
5,256
Saguenay/Lac-Saint-Jean
9
1,097
Mauricie/Bois-Francs
8
1,928
Estrie
4
958
Montérégie
24
5,376
Montréal
33
8,174
Abitibi/Témiscamingue
8
1,058
Outaouais
6
1,335
Laval/Laurentides/
Lanaudière
31
7,220
Gaspé
6
661
Total (excluding the Fund)
160
34,166
Fund: Amounts distributed to non-participating NPOs
Grand total for NPOs
30
$
Amount
distributed to
participating
NPOs
27,888
$ 114,258
Average
sales
per event
$
521
115
30
39
21
117
170
23
27
5,807,072
943,286
2,309,651
1,111,996
7,488,742
10,603,975
852,761
1,156,655
319,844
47,380
128,399
61,686
415,346
605,815
45,575
63,162
1,156,178
187,798
460,327
221,243
1,490,599
2,112,031
169,699
230,688
1,105
860
1,198
1,161
1,393
1,297
806
866
147
16
735
9,636,444
559,237
41,044,348
535,100
21,792
2,271,987
1,919,100
111,245
8,173,166
931,161
9,104,327
1,335
846
1,201
(*) RAC data is for ten months (April 2000 to January 2001).
LA SOCIÉTÉ DES LOTERIES VIDÉO DU QUÉBEC INC.
VIDEO LOTTERIES
No.
No.
No.
No.
of
of
of
of
sites
terminals
terminals per establishment
inhabitants per terminal
4,085
15,251
3.7
1/484
REVENUES AND COMMISSIONS
Money taken in
Money cashed out
Net income
Net profit
Commissions paid to retailers
4,532.1
3,479.0
1,053.1
639.1
315.9
DISTRIBUTION OF SITES AND TERMINALS BY REGION
No. of sites
36
Laval/Lanaudière/Laurentides
Montréal
Québec City/Chaudière/Appalaches
Mauricie/Bois-Francs
Estrie
Saguenay/Lac-Saint-Jean/North Shore
Lower St.Lawrence/Gaspé/Îles-de-la-Madeleine
Abitibi/Northern Québec
Montérégie
Outaouais
Total
599
966
522
326
282
272
217
157
511
233
4,085
No. of terminals
2,375
4,322
1,804
1,122
991
850
602
504
1,841
840
15,251
FINANCIAL REVIEW
For the fiscal year ended March 31, 2001, Loto-Québec posted consolidated
revenues of $3.6 billion, representing an increase of $199 million or 5.8% over the
previous year, with the video lottery and traditional lottery sectors accounting for
the major share of this growth in sales. During the same period, the Corporation’s
operating expenses totalled $613.2 million, an increase of less than 2% as
compared to the previous reporting period, while consolidated net income
reached $1.4 billion, up by 5.9% over fiscal 1999-2000.
REVENUES AND GROSS PROFIT BY SECTOR
CONSOLIDATED
SALES
Lotteries
50.1%
Multimedia
0.1%
Casinos
19.1%
Bingo
1.1%
Video Lotteries
28.9%
Restaurants
0.7%
The lottery sector continued to make the largest contribution to the Corporation’s
total sales, with revenues of $1.8 billion representing a 3.2% increase over 19992000. This growth was attributable in particular to the Super 7 lottery, which
increased its sales figure by $53.9 million. Loto-Québec also saw a rise in its gross
profits during the past fiscal year, up by $10 million over the previous year to reach
$712.8 million. A total of $952.7 million in prizes was awarded to winners during
the year, along with $124.7 million in commissions paid to retailers.
With total revenues of $696.5 million, the casino sector recorded an increase
of 1.9% over the previous year. More specifically, the casinos in Montréal and
Charlevoix posted increases of 3.1% and 11.6% respectively, while the casino in
Hull registered a decrease of $5.4 million or 2.8%, attributable to the installation of
slot machines at the Rideau-Carleton Racetrack. Under a program implemented
during the final quarter of last year, a total of $12.7 million was paid out to casino
patrons in the form of promotional discounts.
Posting total revenues of $66.4 million, the restaurant sector’s financial results
were unchanged from the previous year.
Totalling $1.053 billion in fiscal 2000-2001, the video lottery sector’s sales
were up by 13.4% over the previous year, with the number of terminals in operation
in some 4,100 establishments unchanged since 1997, remaining at approximately
15,200. Commissions paid to retailers operating the sector’s equipment on their
premises amounted to $315.9 million.
For its part, the bingo sector posted revenues of $41 million during the past
fiscal year, an increase of 1.5% over the previous year. In addition, la Société des
bingos du Québec awarded $18.6 million in prizes to winners, along with $2.3
million in commissions to operators of bingo halls.
Finally, the Corporation’s multimedia sector recorded sales of $540,000 in
2000-2001, a portion of which, for the very first time, originated from foreign
markets. In fact, INGENIO’s, contracts abroad included delivery of the Trésors de
la Tour master CD-ROM to la Loterie nationale de Belgique and Treasure Tower to
the Iowa State Lottery in the United States.
37
FINANCIAL REVIEW
OPERATING EXPENSES
Loto-Québec’s operating expenses rose to $613.2 million during the past year, a
slight increase of less than 2% over the previous fiscal year. These expenses represent
a ratio of 16.8% of the Corporation’s total sales, as compared to 17.5% in 1999-2000.
The principal factors accounting for this rise are salary increases and the depreciation
for an entire year of the lottery sector’s game terminals which were installed during
the first quarter of 2000-2001.
OTHER ITEMS
Other items totalled $143 million, an increase of $12.8 million or 9.8% over the
previous year, attributable primarily to consumption taxes (GST and QST). These
items also include $9.1 million in contributions to non-profit organizations made by
the bingo sector out of its operating income.
CONTRIBUTIONS TO GOVERNMENTS
Loto-Québec’s contribution in the form of dividends to the Minister of State for the
Economy and Finance amounted to $1.331 billion in fiscal 2000-2001. An additional
$45.8 million was paid into the Québec Government’s various designated funds, as
well as $89.2 million to the Minister of Revenue in tax on capital and Québec Sales
Tax (QST). As such, total contributions paid to the Québec Government equalled
over $1.466 billion. Moreover, the Corporation contributed $13.5 million to the
Government of Canada as compensation for its withdrawal from the lottery sector,
as well as $74.2 million in Goods and Services Tax (GST).
38
F I N A N C I A L S TAT E M E N T S
MANAGEMENT REPORT
The Board of Directors is responsible for the consolidated financial statements drawn up for the shareholder. It delegates
responsibility for preparing them to senior management, while the Audit Committee reviews them.
Management has a system of internal controls to ensure that the financial statements are reliable, and Internal Audit monitors
the system to ensure it works properly.
The consolidated financial statements are prepared according to Canadian generally accepted accounting principles which,
in certain cases, require judgements on the part of management. The financial information contained within the rest of the
annual report corresponds to the information provided in the financial statements.
By law, the Auditor General of Québec audits the books and accounts of Loto-Québec. The Audit Committee and the Auditor
General meet with management to discuss questions pertaining to the audit and to the consolidated financial statements.
Audit Committee members have no link to Loto-Québec other than as directors.
Upon the recommendation of the Audit Committee, the Board of Directors has approved the consolidated financial statements
of Loto-Québec for the fiscal year ended March 31, 2001.
Michel Crête
Chairman of the Board and
Chief Executive Officer
Gérard Houle, CMA
Corporate Vice-President
Finance and Administration
Montréal, May 24, 2001
AUDITOR’S REPORT
To the Minister of State for Economy and Finance
I have audited the consolidated balance sheet of Loto-Québec as at March 31, 2001 and the consolidated statements of income,
retained earnings and cash flows for the year then ended. These financial statements are the responsibility of Loto-Québec’s
management. My responsibility is to express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with Canadian generally accepted auditing standards. Those standards require that I plan
and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.
In my opinion, these consolidated financial statements present fairly, in all material respects, the financial position of LotoQuébec as at March 31, 2001, and the results of its operations and cash flows for the year ended in accordance with Canadian
generally accepted accounting principles. As required by the Auditor General Act (R.S.Q., Chapter V-5.01), I report that, in
my opinion, these principles have been applied on a basis consistent with that of the preceding year.
Guy Breton, FCA
Auditor General of Québec
Québec City, May 24, 2001
39
CONSOLIDATED STATEMENT OF INCOME
2001
REVENUE
COST OF SALES (note 3)
GROSS PROFIT
$
OPERATING EXPENSES
Operating expenditures
Depreciation of fixed assets
Amortization of patents
Amortization of deferred charges
Interest - net (note 4)
INCOME BEFORE THE FOLLOWING ITEMS
Special payments (note 5)
Goods and services tax
Québec sales tax
NET INCOME
3,643,212
1,483,178
2,160,034
2000
$
3,444,225
1,386,745
2,057,480
527,742
77,721
309
308
7,149
613,229
527,214
68,044
–
308
5,863
601,429
1,546,805
28,871
53,136
61,040
143,047
1,403,758
1,456,051
25,792
48,638
55,830
130,260
1,325,791
Segmented information (note 20)
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
(IN THOUSANDS OF DOLLARS) for the year ended March, 31 2001
2001
BALANCE AT BEGINNING OF YEAR
Net income
Dividends
Fonds d’aide à l’action communautaire autonome (note 6)
Contributions to the Québec government (note 7)
BALANCE AT END OF YEAR
40
$
132,428
1,403,758
1,536,186
(1,330,500)
(17,572)
(28,269)
(1,376,341)
159,845
2000
$
94,225
1,325,791
1,420,016
(1,251,000)
(16,348)
(20,240)
(1,287,588)
132,428
CONSOLIDATED BALANCE SHEET
(IN THOUSANDS OF DOLLARS) As at March 31, 2001
2001
ASSETS
CURRENT
Cash on hand – casinos
Cash on hand
Accounts receivable (note 8)
Inventory (note 9)
Prepaid expenses
Investment
Fixed assets (note 10)
Patents, amortized
Deferred charges, amortized (note 11)
LIABILITIES
CURRENT
Bank loans (note 12)
Prizes payable
Accounts payable and accrued liabilities (note 13)
Provisions related to prizes (note 14)
Deferred income
SHAREHOLDER’S EQUITY
Capital-stock authorized, issued and fully paid:
1,700 shares with a par value of $100 each
RETAINED EARNINGS
$
33,247
27,867
67,402
8,946
16,158
153,620
2000
$
28,686
26,979
53,468
7,925
17,987
135,045
34,131
539,482
617
1,651
729,501
35,417
470,764
926
923
643,075
232,025
48,225
240,911
33,757
14,568
569,486
247,923
41,774
165,324
39,238
16,218
510,477
170
159,845
160,015
729,501
170
132,428
132,598
643,075
Commitments (note 15)
On behalf of the Board of directors
Michel Crête
Chairman of the Board
Robert Crevier, CA
Chairman of the Audit Committee
41
CONSOLIDATED STATEMENT OF CASH FLOWS
2001
OPERATING ACTIVITIES
Net income
Items not affecting cash flows:
Net contribution to the Manoir Richelieu LP
Share of the earnings of Nter Technologies, LP
Changes in assets and liabilities related to operations (note 16)
Operating activities cash flows
FINANCING ACTIVITIES
Dividends paid
Bank loans
Contributions to the Québec Government
Fonds d’aide à l’action communautaire autonome
Financing activities cash flows
INVESTMENT ACTIVITIES
Acquisitions of fixed assets
Deposits for the acquisition of fixed assets
Acquisition of investments
Distribution to the Manoir Richelieu LP
Distribution of the Manoir Richelieu LP
Acquisition of deferred charges
Acquisition of patents
Investment activities cash flows
NET INCREASE IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS AT END OF YEAR (note 16)
42
$
1,403,758
2000
$
1,325,791
77,721
309
308
5,762
(116)
(6,772)
1,480,970
68,044
–
308
3,125
–
(1,271)
1,395,997
(1,265,000)
(15,898)
(28,105)
(17,572)
(1,326,575)
(1,262,000)
51,274
(19,745)
(16,348)
(1,246,819)
(143,129)
(96)
(62)
(5,196)
573
(1,036)
–
(148,946)
(113,919)
(360)
(16,578)
–
–
–
(165)
(131,022)
5,449
55,665
61,114
18,156
37,509
55,665
Notes to financial statements
March 31, 2001
NOTE 1. AUTHORITY AND OBJECTIVES
The Société des loteries du Québec (the Corporation), also designated as Loto-Québec, is a joint-stock corporation whose
shares form part of the public domain and are allotted to the Minister of Finance. Under its act of incorporation (R.S.Q., Chapter
S-13.1), its functions are to conduct and administer lottery schemes and to operate businesses which are incidental to the
operation of a State casino. It may also offer, for consideration, consulting and implementation services in matters within its
competence.
NOTE 2. ACCOUNTING POLICIES
The consolidated financial statements of Loto-Québec have been prepared by management in accordance with Canadian
generally accepted accounting principles. These statements comprise amounts based on best judgement and estimates.
Consolidation
The consolidated financial statements include the accounts of Loto-Québec and its wholly-owned subsidiaries:
•
•
•
•
•
Lotim inc.
La Société des casinos du Québec inc.
Casiloc inc.
La Société des loteries vidéo du Québec inc.
Resto-Casino inc.
•
•
•
•
Ingenio, filiale de Loto-Québec inc.
La Société des bingos du Québec inc.
World Gaming Consultants, inc.
9059-3849 Québec inc.
The investments in the Manoir Richelieu Limited Partnership and Nter Technologies, Limited Partnership are entered at their
consolidated value.
Revenue
Lotteries
Gross revenue from the sale of lottery tickets and bingo cards is recorded on the date of the draw, with the exception of
revenue from instant lottery ticket sales, which is entered at the time of sale.
With the exception of instant lotteries, lottery tickets sold as at March 31 for draws subsequent to that date are treated as
deferred income. Discounts to retailers on these sales are carried as prepaid expenses.
Casinos and Video Lotteries
Revenue from the operation of these activity sectors corresponds to the difference between wagers and prizes awarded.
Multimedia
Revenues represent royalties based on a certain percentage of the total of the CD-ROM/lottery ticket retail price. These revenues
are recorded when the printer delivers the CD-ROM/lottery tickets to the lottery corporations.
Prizes Awarded
Prizes awarded from ticket sales for bingo and certain lottery products are based on a theoretical sales rate.
In addition to lottery prizes in cash or merchandise, Loto-Québec also awards free tickets. The value ascribed to these prizes
is equal to the selling price and is included with sales as revenue and with prizes as expenditure.
Promotional Allowances
These amounts represent the promotional cash rebates issued to casino customers.
Pension Plans
Cost-based pension plan accounting is applied to inter-company governmental benefit-based pension plans such as the
Régime de retraite des employés du gouvernement et des organismes publics (RREGOP) and the Régime de retraite des
fonctionnaires (RRF), given that Loto-Québec, La Société des loteries vidéo du Québec inc., La Société des bingos du Québec
inc. and Ingenio, filiale de Loto-Québec inc. do not have adequate information to apply benefit-based pension plan accounting
practices.
43
March 31, 2001
Inventory
Video lotteries
The inventories are valued at the lower of average cost and replacement value.
Restaurants
The inventories are valued at the lower of cost and net realizable value. Cost is estimated as follows:
Food and drink: average cost
Kitchen equipment: base stock
Fixed assets
Fixed assets are presented at acquisition cost and, with the exception of works of art, are depreciated according to their
estimated useful life using the straight-line method based on the following annual rates:
Buildings
Parking lot landscaping
Rented parking lot landscaping
Interior design
2% to 6 2/3%,
10% and 20%
6 2/3%
6 2/3%
10% to 20%
Landscaping
Leasehold improvements
Office furniture
Rolling stock
Equipment
10%
10%
10%
30%
10%
and 14.29%
to 20%
and 20%
to 33 1/3%
Patents
Patents are presented at cost and are amortized using the straight-line method over a three-year period.
Deferred charges
Deferred charges correspond to the cost of the Pont des Îles, a property of the City of Montréal but paid by a subsidiary of
Loto-Québec. These charges are amortized using the straight-line method at an annual rate of 10%.
The start-up costs related to the expansion of the Casino de Hull and development of the adjoining resort complex will be
amortized as of the beginning of operations.
NOTE 3. COST OF SALES
2001
LOTTERIES
Prizes awarded
Commissions to retailers
Printing of tickets
CASINOS
Promotional allowances
VIDEO LOTTERIES
Printing
44
BINGOS
Prizes awarded
Commissions to operators
Printing of cards
RESTAURANTS
$
952,674
124,705
35,048
1,112,427
2000
$
913,752
121,286
30,115
1,065,153
12,720
1,177
315,915
757
316,672
278,522
703
279,225
18,600
2,272
310
21,182
20,177
1,483,178
18,265
2,220
402
20,887
20,303
1,386,745
March 31, 2001
NOTE 4. INTEREST – NET
2001
Interest on bank loans
Interest on term deposits
$
8,567
(1,418)
7,149
2000
$
6,985
(1,122)
5,863
NOTE 5. SPECIAL PAYMENTS
2001
Compensation to the government of Canada
Net contribution to the Manoir Richelieu LP
Share of the results of Nter Technologies, LP
Special commissions to non-profit organizations (NPOs)
Compensation to participating NPOs
Compensation to non-participating NPOs
$
13,484
5,762
(116)
637
8,173
931
28,871
2000
$
13,172
3,125
–
453
8,067
975
25,792
Compensation to the government of Canada
Under an agreement reached between the provincial governments and the government of Canada concerning the federal
government’s withdrawal from the administration of lotteries, the provinces pay the federal government the equivalent of
$24 million, in 1979 dollars, every year. For the year ended March 31, 2001, this amount equalled $55.2 million (2000: $53.7
million).
The Québec government’s share is payable by the Corporation in accordance with an agreement between the provinces and
regional lottery corporations.
Net contribution to the Manoir Richelieu Limited Partnership
Under the terms of the guarantee agreement and in accordance with the distribution methods specified in the partnership
agreement, the net contribution represents the minimum share of liquidities generated by the operations of the Casino de
Charlevoix that is to be remitted to the partners, after considering Loto-Québec’s share in the earnings of the
Manoir Richelieu Limited Partnership.
Special commissions to non-profit organizations (NPOs)
Further to a decision by the shareholder, a commission equal to the discount allotted to retailers is paid to non-profit
organizations selling lottery tickets through the LOTOMATIQUE subscription system.
Compensation to non-profit organizations (NPOs)
The amended bingo regulations, in effect as of October 15, 1999, establish the following compensation for NPOs:
Participating NPOs
La Société des bingos du Québec inc. allots charitable or religious organizations that hold a bingo licence an amount equal
to the higher of 36.4% of bingo ticket sales less the value of prizes paid to game winners (20% of bingo ticket sales before
the amendment), or 50% of net income generated by bingo games, not counting compensation to non-participating NPOs.
Non-participating NPOs
La Société des bingos du Québec inc. allots an amount equal to 5.45% of total ticket sales of the LE GRAND TOUR game,
less the value of prizes awarded to winners of this game, to charitable or religious organizations that hold a bingo licence
but do not participate in the Corporation’s bingo games (3% of ticket sales of the LE GRAND TOUR game before the
amendment).
45
March 31, 2001
NOTE 6. FONDS D’AIDE À L’ACTION COMMUNAUTAIRE AUTONOME
Under its act of incorporation, each year the Corporation pays into the Fonds d’aide à l’action communautaire autonome,
dedicated to supporting independent community and international humanitarian action, sums equivalent to 5% and 1%
respectively of net income earned during the previous fiscal year through the operation of the state-run casinos and the
businesses which are incidental to them.
NOTE 7. CONTRIBUTIONS TO THE QUÉBEC GOVERNMENT
2001
Ministère des Finances(1)
Ministère de l’Agriculture, des Pêcheries et de l’Alimentation (MAPAQ)
Ministère de la Santé et des Services sociaux
Ministère des Affaires municipales
$
19,769
5,000
3,000
500
28,269
2000
$
11,640
5,000
3,000
600
20,240
(1) Of this amount, with the authorization of the Government, the Corporation contributed a total of $7.2 million to the Société nationale du cheval de
course (SONACC) to enable the organization to increase the funds for its regular racing programs and special events during fiscal 2000-2001.
NOTE 8. ACCOUNTS RECEIVABLE
2001
Wholesalers
Retailers
Miscellaneous
$
33,209
21,131
13,062
67,402
2000
$
20,671
15,785
17,012
53,468
NOTE 9. INVENTORY
2001
Video lotteries
Video lottery terminals
Restaurants
Food and drink
Kitchen equipment
46
$
3,530
4,257
1,159
5,416
8,946
2000
$
3,010
3,739
1,176
4,915
7,925
March 31, 2001
NOTE 10. FIXED ASSETS
2001
Accumulated
Depreciation
Cost
Land
Buildings
Parking lot landscaping
Rented parking lot landscaping
Interior design
Landscaping
Leasehold improvement
Office furniture and rolling stock
Equipment
Works of art
Construction in progress
$
32,093
227,044
85,030
4,922
76,057
21,302
37,472
24,173
378,006
2,858
87,736
976,693
$
–
49,280
31,966
1,397
48,745
10,012
18,364
14,927
262,520
–
–
437,211
2000
Net
Net
$ 32,093
177,764
53,064
3,525
27,312
11,290
19,108
9,246
115,486
2,858
87,736
539,482
$ 29,797
159,797
48,262
3,791
31,570
10,890
20,758
7,365
139,950
2,502
16,082
470,764
NOTE 11. DEFERRED CHARGES AMORTIZED
2001
Start-up costs
Pont des Îles
$
1,036
615
1,651
2000
$
–
923
923
NOTE 12. BANK LOANS
Demand bank loans are authorized by the Québec government for a maximum amount of $400 million and bear interest at
market rates.
NOTE 13. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
2001
Suppliers and accrued liabilities
Dividends
Manoir Richelieu LP
Nter Technologies LP
Québec sales tax
$
115,077
111,500
5,351
1,902
3,785
3,296
240,911
2000
$
105,267
46,000
5,676
–
4,545
3,836
165,324
47
March 31, 2001
NOTE 14. PROVISIONS RELATED TO PRIZES
2001
Provision for unclaimed prizes
Provision for prize structure variances
$
6,533
27,224
33,757
2000
$
12,431
26,807
39,238
The provision for unclaimed prizes is made up of unclaimed prizes from all Loto-Québec products, excluding Canada-wide
games. This amount is used for payment of bonus and retailer prizes.
The provision for prize structure variances in bingo and certain lottery products is made up of all differences between the
theoretical amount of prizes to be awarded under the prize structure and the actual amount payable. Monies from this provision
are used principally to offset occasional shortfalls arising from prize structures that exceed the forecast amount. With the
approval of the Board of Directors, this provision may also be used for bonus prizes or for discharging any claims associated
with the games, or it may be included in the results.
NOTE 15. COMMITMENT
Leases
Under an agreement expiring in 2003, the Corporation is committed to paying a minimum of $16.6 million in total for the
rental of the premises occupied by its head office in a building held in joint tenancy with SITQ Bureaux inc., representing a
consolidated commitment of $8.3 million. In addition, the Corporation is committed to renting space for administrative offices
under long-term leases expiring on various dates up until 2035. In certain cases, these leases have a two- to five-year renewal
option.
The minimum monthly rental payments, in thousands of dollars, are as follows:
2002
2003
2004
2005
2006
2007 and subsequent
13,800
12,256
8,023
5,065
2,865
18,932
60,941
Video lotteries
In December 1997, the Québec government authorized a subsidiary of Loto-Québec to acquire a central system including site
controllers for an amount not exceeding $20 million, of which $6 million (2000: $6 million) was accounted for as at
March 31, 2001. At that date, commitments related to this project totalled $13.3 million (2000: $13.6 million).
In August 1999, the Québec government authorized that same subsidiary to acquire bar code scanners for the operation of
video lottery systems for an amount not exceeding $7 million, of which $0.01 million was accounted for as at March 31, 2001.
At that date, contractual commitments related to this project totalled $2.6 million.
In addition, in May 2000, the Québec government authorized this Corporation to acquire video lottery terminals for an amount
not to exceed $219 million.
Expansion of the Casino de Hull and construction of a resort complex
48
The total budget for this project is $228 million. As at March 31, 2001, $94 million (2000: $12.7 million) was accounted for,
and commitments at that date totalled $70.4 million (2000: $20.9 million).
March 31, 2001
Contributions to the Québec government
Ministère des Finances
With the authorization of the Québec government, the Corporation has given its commitment to the Ministère des Finances
to pay sums into a designated fund to finance certain projects and activities pertaining to the plan to revitalize the horseracing
industry. This temporary contribution is equivalent to the annual commission collected by Québec racetracks for video lottery
terminals. The Corporation is unable to assess the total amount of this commitment.
In addition, with the authorization of the Québec government, the Corporation has committed to paying $12.4 million during
fiscal 2001-2002 to the Société nationale du cheval de course (SONACC) to enable that organization to increase the purses
for regular racing programs and special events.
Ministère de l’Agriculture, des Pêcheries et de l’Alimentation (MAPAQ)
In view of the decision to terminate the activities of fairground casinos, the Government authorized Loto-Québec to give its
commitment to the MAPAQ to pay an annual sum of $5 million into a designated fund for five years, starting in the 1998
calendar year. Upon expiry, the agreement will be renewable by mutual consent of the parties.
Ministère de la Santé et des Services sociaux
With the authorization of the Québec government, the Corporation has given its commitment to the Ministère de la Santé et
des Services sociaux to pay sums totalling $75 million into a designated fund over a six-year period to finance prevention
activities, treatment services, research programs, and information campaigns to help compulsive gamblers. For the coming
years, the payments related to the balance of this commitment, in thousands of dollars, are as follows:
2002
2003
2004
2005
18,000
17,000
17,000
17,000
69,000
Ministère de la Sécurité publique
With the authorization of the Québec government, the Corporation has given its commitment to the Ministère de la Sécurité
publique to pay sums totalling $11 million into a designated fund over a four-year period to finance a series of rigorous
control activities and measures to be implemented by the Régie des alcools, des courses et des jeux related, in particular, to
overseeing access to video lottery terminals. For the coming years, the payments related to this commitment, in thousands of
dollars, are as follows:
2002
2003
2004
2005
2,000
3,000
3,000
3,000
11,000
Ministère des Affaires municipales
In view of the decision to terminate the activities of temporary casinos, the Government authorized Loto-Québec to give its
commitment to the Ministère des Affaires municipales to pay a sum of $2.6 million into a designated fund over a five-year
period to finance certain organizations, projects and activities in the field of sports and recreation. For the coming years, the
payments related to the balance of this commitment, in thousands of dollars, are as follows:
2002
2003
400
300
700
49
March 31, 2001
NOTE 16. CONSOLIDATED CASH FLOWS
2001
Cash and cash equivalents
Cash on hand – Casinos
Cash on hand
Changes in assets and liabilities related
to operations
Accounts receivable
Inventory
Prepaid expenses
Prizes payable
Accounts payable and accrued Liabilities
Provisions related to prizes
Deferred income
Supplementaty information
Interest paid
Prepaid expenses transferred to fixed assets
$
33,247
27,867
61,114
2000
$
28,686
26,979
55,665
(13,934)
(1,021)
487
6,451
8,376
(5,481)
(1,650)
(6,772)
(2,382)
576
1,605
6,624
11,945
913
(20,552)
(1,271)
8,282
1,438
7,003
14,359
NOTE 17. PENSION PLANS
Employees of the parent corporation, La Société des loteries vidéo du Québec inc., La Société des bingos du Québec inc.,
and Ingenio, filiale de Loto-Québec inc. participate in the Régime de retraite des employés du gouvernement et des organismes
publics (RREGOP) and the Régime de retraite des fonctionnaires (RRF). These are benefit-based pension plans and contain
guarantees upon retirement or death. Up until December 31, 1999, the employer’s level of contribution for regular service
under the RREGOP equalled 5.22% of the admissible salary of participants who could be unionized (5.02% for participants
who cannot be unionized). Subsequent to certain modifications to the plan, as of January 1, 2000, the employer’s level of
contribution for regular service equals 3.51% of the admissible salary of participants who could be unionized (0.79% for
participants who cannot be unionized). Contributions charged to consolidated earnings for the fiscal year for these plans total
$1.4 million (2000: $1.8 million). The employer’s obligations towards these government plans are limited to its contributions
for current services.
La Société des casinos du Québec inc. and Resto-Casino inc. offer their employees a cost-based pension plan, paying an
amount equal to the employee’s contribution, up to 5% of the annual base salary. The employer’s contribution is vested to
the employee upon payment. Contributions charged to consolidated earnings for the fiscal year under this plan total
$6.3 million (2000: $6 million).
NOTE 18. RELATED PARTY TRANSACTIONS
Over the course of the fiscal year, the Corporation received the consulting and management services of a limited partnership
for a total of $10.4 million.
50
In addition to the related party transactions already outlined and accounted for at exchange value, Loto-Québec is related to
all Québec government departments and special funds, as well as all agencies and enterprises controlled directly or indirectly
by the Government, or subject either to joint control or to significant mutual influence on the part of the Government. The
Corporation has not concluded any business transaction with these related parties other than within the normal course of its
activities and on regular business terms. These transactions are not disclosed separately in the financial statements.
NOTE 19. COMPARATIVE FIGURES
Certain figures for the year 2000 have been reclassified in order to conform to the 2001 presentation.
March 31, 2001
NOTE 20. SEGMENTED INFORMATION
2001
É TAT S F I N A N C I E R S
Activity sectors
Lotteries/
corporate (1)
Revenue
Cost of sales
Gross profit
OPERATING EXPENSES
Operating expenditures(1)
Depreciation of
fixed assets
Amortization of
deferred charges
Interest – net
Income (loss) before the
following items
Special payments(1)
Goods and services tax(1)
Québec sales tax(1)
Net income (loss)
Restaurants
Intercompany Consolidated
elimination
figures
540
–
540
66,355
20,177
46,178
(39,773) 3,643,212
(300) 1,483,178
(39,473) 2,160,034
5,211
6,680
37,724
(39,473)
8,715
–
698
–
120
309
4,792
–
–
(110)
44,249
–
(15)
5,894
–
(14)
7,095
45
–
42,561
13,968
(6,555)
3,617
–
1,546,805
9,104
444
509
10,057
3,911
–
–
–
–
(6,555)
–
–
–
–
3,617
–
–
–
–
–
28,871
53,136
61,040
143,047
1,403,758
Casinos
Video
lotteries
Bingos
1,825,528
1,112,727
712,801
696,471
12,720
683,751
1,053,047
316,672
736,375
41,044
21,182
19,862
161,419
320,537
35,644
23,749
–
39,647
–
–
8,236
193,404
263
(948)
359,499
519,397
324,252
692,126
14,005
18,988
21,893
54,886
464,511
5,762
9,011
10,330
25,103
299,149
–
24,693
28,308
53,001
639,125
Multimedia
–
–
–
–
(39,473)
527,742
77,721
309
308
7,149
613,229
(1) Indirect costs were paid by the lotteries/corporate sectors and charged back to other activity sectors in accordance with the extent of their
use. An amount of $45.4 million was charged towards the casino sector’s results, an amount of $55 million to those of the video lotteries
sector, and $1.8 million to the bingo sector.
51
March 31, 2001
NOTE 20. SEGMENTED INFORMATION
2000
Restaurants
Intercompany Consolidated
elimination
figures
323
–
323
66,558
20,303
46,255
(43,186) 3,444,225
(323) 1,386,745
(42,863) 2,057,480
5,299
4,488
39,111
(42,863)
527,214
12,123
950
70
4,933
–
68,044
–
(104)
48,795
–
(12)
6,237
–
(6)
4,552
45
–
44,089
–
–
(42,863)
308
5,863
601,429
13,309
(4,229)
2,166
– 1,456,051
9,042
479
549
10,070
3,239
–
–
–
–
(4,229)
–
–
–
–
2,166
–
25,792
–
48,638
–
55,830
–
130,260
– 1,325,791
Activity sectors
Lotteries/
corporate (1)
Casinos
Revenue
Cost of sales
Gross profit
1,768,224
1,065,476
702,748
683,461
1,177
682,284
928,412
279,225
649,187
40,433
20,887
19,546
162,957
321,446
36,776
12,729
37,239
–
6,771
182,457
263
(786)
358,162
520,291
324,122
600,392
13,625
17,458
20,085
51,168
469,123
3,125
8,339
9,559
21,023
303,099
–
22,362
25,637
47,999
552,393
OPERATING EXPENSES
Operating expenditures(1)
Depreciation of
fixed assets
Amortization of
deferred charges
Interest – net
Income (loss) before
the following items
Special payments(1)
Goods and services tax(1)
Québec sales tax(1)
Net income (loss)
Video
lotteries
Bingos
Multimedia
(1) Indirect costs were paid by the lotteries/corporate sectors and are charged back to other activity sectors in accordance with the extent of
their use. An amount of $37.5 million was charged towards the casino sector’s results, an amount of $49.2 million to those of the video
lotteries sector, and $1.9 million to the bingo sector.
52
C O M PA R AT I V E S U M M A RY
of ear nings
CONSOLIDATED EARNINGS
Revenue
2001
2000
1999
1998
1997
$ 3,643,212
$ 3,444,225
$ 3,130,279
$ 2,837,442
$ 2,619,613
952,674
124,705
35,048
1,112,427
913,752
121,286
30,115
1,065,153
859,155
114,015
25,217
998,387
805,233
107,677
23,197
936,107
781,110
104,813
22,389
908,312
12,720
1,177
315,915
757
316,672
278,522
703
279,225
230,388
646
231,034
175,627
511
176,138
139,884
532
140,416
18,600
2,272
310
21,182
18,265
2,220
402
20,887
18,572
2,256
444
21,272
6,556
795
102
7,453
20,177
1,483,178
2,160,034
20,303
1,386,745
2,057,480
16,944
1,267,637
1,862,642
14,812
1,134,510
1,702,932
13,658
1,062,386
1,557,227
161,419
281,064
35,644
5,211
6,680
37,724
77,721
309
308
7,149
613,229
1,546,805
162,957
278,583
36,776
5,299
4,488
39,111
68,044
137,742
251,050
30,242
4,934
128,664
239,611
38,244
2,600
118,545
228,468
33,303
32,791
74,451
30,383
72,375
28,387
67,124
308
5,863
601,429
1,456,051
4,386
4,796
540,392
1,322,250
4,588
6,616
523,081
1,179,851
6,904
10,512
493,243
1,063,984
28,871
53,136
61,040
143,047
1,403,758
25,792
48,638
55,830
130,260
1,325,791
25,296
44,139
50,812
120,247
1,202,003
16,789
35,753
36,899
89,441
1,090,410
13,474
34,282
34,179
81,935
982,049
COST OF SALES
LOTTERIES
Prizes awarded
Discounts to retailers
Printing of tickets
Lotteries subtotal
CASINOS
VIDEO LOTTERIES
Printing
Video lotteries subtotal
BINGO GAMES
Prizes awarded
Commissions to operators
Printing of cards
Bingo games subtotal
RESTAURANTS
Total
GROSS PROFIT
OPERATING EXPENSES
Lotteries
Casinos
Video lotteries
Bingo games
Multimedia
Restaurants
Interest – net
INCOME BEFORE THE FOLLOWING ITEMS
Special payments
Québec sales tax
NET INCOME
53
CORPORATE STRUCTURE
Deputy Premier and Minister
of State for Economy and Finance
Mrs. Pauline Marois
Board of Directors
Chairman and Chief Executive Officer
Michel Crête
54
1st Vice-President
Claude Trudel
Executive Assistant to the Chairman and
Director Strategic Planning
Réjean Villeneuve
Senior Director Corporate Security
Michel Gougeon
Director Internal Audit
Jacques Dubois, FCGA
Corporate
Vice-President
Finance and
Administration
Gérald Houle, CMA
Vice-President
Corporate
Affairs
Lynne Roiter, LL.L.
Corporate
Vice-President
Human
Resources
Yvan Cossette
CASILOC INC.
President
Operations
Gille Dufour
RESTO-CASINO INC.
President
Operations
Jean Royer
SOCIÉTÉ DES
LOTERIES VIDÉO INC.
President
Operations
Claude Trudel
SOCIÉTÉ
DES BINGOS
DU QUÉBEC INC.
President
Operations
Claude Trudel
Vice-President
Design and
Construction
Jean-Claude
Champagne
Vice-President and
Executive Director
Claude Poisson
General Manager
Hilton Lac Leamy
René Gounel
Corporate
Vice-President
Communications
and Public Affairs
Patrice Tardif
LOTIM INC.
President
Operations
Lynne Roiter, LL.L.
Vice-President
Research,
Development
and New Markets
Jean Royer
SOCIÉTÉ DES CASINOS
DU QUÉBEC INC.
President
Operations
Jean Royer
1st Vice-President
Operations
Claude Poisson
General Manager
Josée Provost
General Manager
Michel Hupé
General Manager
Casino de
Charlevoix
Jacques Gamache
Vice-President
Information
Technology
Beaudoin
Daigneault
SOCIÉTÉ DES
LOTERIES
President
Operations
Robert Ayotte
INGENIO, FILIALE DE
LOTO-QUÉBEC INC.
President
Operations
Jean Royer
Vice-President
Marketing
Michel St-Germain
General Manager
Casino de
Montréal
Jacques Grilli
General Manager
Casino de
Hull
Michel Belley
General Manager
Nathalie Rajotte
BOARD OF DIRECTORS
2
1
3
2 LYNNE ROITER, LL.L.
1 MICHEL CRÊTE
Mont-Royal
Loto-Québec
4
3 ROGER BLAIS
Westmount
Vice-President
Corporate Affairs
Corporate Secretary
4 FRANCINE DE MONTIGNY LA HAYE
Montréal
Partner-Director of
Cabinet de relations
publiques National inc.
Montréal
5
Montréal
President
JJDS Capital inc.
▲
7
5 YVON MARTIN
Gatineau
Engineer
Physical Engineering
6 JOSEPH BENARROSH
6
▲
Montréal
President
Les Placements Solicom inc.
8 CHRISTIANE BOIS
Québec
Managing Director
Société historique
de Québec
8
7 ROBERT CREVIER,
CA
▲■
Montréal
Management Consultant
▲
Member of the Audit Committee
■
Member of the Security Committee
SENIOR MANAGEMENT
MICHEL CRÊTE
Loto-Québec
ROBERT AYOTTE
President Operations
La Société des loteries
du Québec
YVAN COSSETTE
Human Resources
GILLE DUFOUR
Casiloc inc.
GÉRALD HOULE, CMA
Finance and Administration
RÉJEAN VILLENEUVE
Executive Assistant
to the Chairman and
Director
Strategic Planning
LYNNE ROITER, LL.L.
Vice-President
Corporate Affairs
Corporate Secretary
Lotim inc.
BEAUDOIN DAIGNEAULT
Vice-President
Information Technology
JEAN ROYER
La Société des casinos
du Québec inc.
Resto-Casino inc.
INGENIO, filiale de
Loto-Québec inc.
Vice-President
Research, Development
and New Markets
PATRICE TARDIF
Communications and
Public Affairs
CLAUDE TRUDEL
La Société des bingos
du Québec inc.
La Société des loteries vidéo
du Québec inc.
1st Vice-President
Loto-Québec
55
C O R P O R AT E F U N C T I O N S
STRATEGIC PLANNING: THE CORNERSTONE OF COHERENT EXPANSION
Orientation of actions programs and the initiatives of administrative units and subsidiaries in accordance with
action corporate values, priorities and objectives
CORPORATE SECURITY: INTEGRITY OF PERSONNEL AND OPERATIONS, AND PROTECTION OF FACILITIES
AND EQUIPMENT
Development and implementation of specific security standards and procedures for each of Loto-Québec’s
facilities and operations and those of its subsidiaries
Establishment, coordination and follow-up of preventative measures and plans of action
Strengthening of computer security
FINANCE AND ADMINISTRATION: OPERATIONS CONTROL AND SUPPORT
Entry of all corporate transactions and those of the Corporation’s subsidiaries
Financial analyses and information required for decision making
Overall operational and budgetary control of operations
Cash flow management and optimization of corporate funds
Management of insurance portfolio
Procurement of goods and services
Building management and general services
INTERNAL AUDIT: METHODICAL, ONGOING EVALUATION OF CONTROL SYSTEMS
Evaluation of current and potential risks
Consulting expertise and support for senior management in its efforts to optimize resources
Inclusion of managers in the activity evaluation process
CORPORATE AFFAIRS: UPHOLDING OF INTEGRITY AND CREDIBILITY AND MAXIMIZING INTERNATIONAL
INFLUENCE
Corporate Secretariat for Loto-Québec and its subsidiaries
Corporate legal services
Formulation and follow-up of application of Code of Ethics and corporate policies
Formulation and implementation of corporate program for scientific research and prevention
of compulsive gambling
Management of documentary resources
Administration of Lotim subsidiary
Maintenance of General Secretariat of World Lottery Association (WLA)
HUMAN RESOURCES: DEVELOPMENT AND RECOGNITION OF SKILLS
Formulation, implementation and follow-up of policies, programs and management systems
for all Loto-Québec personnel and subsidiary employees
Workforce planning; hiring, integration and training of employees
Labour relations
Payroll and management information
Financial aspects of occupational health and safety
Employee assistance; retirement planning
Career planning and management
Succession planning
INFORMATION TECHNOLOGY: EVOLUTION AND RELIABILITY OF SYSTEMS
56
Development, management and operation of lottery and lottery management systems,
as well as administrative systems of Loto-Québec
Planning and control of technological infrastructure development
Monitoring of technological developments; consulting expertise to senior management
Adaptation of systems to customer requirements
Maintenance of maximum availability of gaming systems
Technical support for retailers and wholesalers in the network and internal users
of computer technology
Technical assistance and support for subsidiaries
C O R P O R AT E F U N C T I O N S
RESEARCH, DEVELOPMENT AND NEW MARKETS: DIVERSIFICATION OF PRODUCTS AND EXPANSION OF
ACTIVITIES
Development of products fostering growth and profitability of the gaming sectors
Creation of bridges between the worlds of entertainment and gaming
Development of a testing ground for new groups of games
Formation of partnerships with the private sector
Exploration of the commercial potential of products developed for Loto-Québec
and its subsidiaries
COMMUNICATIONS AND PUBLIC AFFAIRS: PROMOTING THE CORPORATE REPUTATION FOR EXCELLENCE,
TRANSPARENCY OF COMMUNICATIONS, AND COMMUNITY PRESENCE
Customer service
Responsibility for conducting of sports betting operations, draws and televised games
Promotion of corporate image
Dissemination of information about Loto-Québec and its subsidiaries
Media relations
Internal communications
Sponsorships
Loto-Québec Art Collection
LANGUAGE POLICY
In accordance with the Government's policy on the
use and quality of French in the public administration, the Corporation has adopted a
language policy that reflects its mission and takes into account the commercial nature of its
operations.
The policy covers the use and quality of French, both in communications within the
Corporation and its subsidiaries and in corporate communications and relations with the
public, its partners, and its suppliers.
QUALITY OF LANGUAGE: A CHERISHED VALUE
AWARDING OF CONTRACTS: INTEGRITY AND TRANSPARENCY
In order to ensure the integrity and transparency of its operations, Loto-Québec continues
to pay scrupulous attention to the application of its policies in awarding contracts. Continued
growth and an increasing variety of mandates has led the Corporation, over the past fiscal
year, to acquire new tools to better meet the needs of its different activity sectors and to
respond to the changing realities of doing business within these sectors.
57
CODE
OF ETHICS
and Rules of Professional Conduct
In view of the Regulation respecting the ethics and professional conduct of public office holders, the members of LotoQuébec’s Board of Directors have established a Specific Code of Ethics and Rules of Professional Conduct.
The values contained in this Code, notably integrity, loyalty and transparency, are values which Loto-Québec has always
emphasized and which all senior executives of the Corporation are required to respect. During the last fiscal year, the
provisions of the Code have been fully adhered to by all those to whom it applies.
1 DEFINITIONS
1.
In this Code, unless the context indicates otherwise:
a)
“director” means a member of the Board of Directors
of Loto-Québec or any of its subsidiaries, whether or
not working full-time within Loto-Québec or any of its
subsidiaries
• Performance: by offering the best possible
entertainment products and services in the lottery,
casino, video lottery and bingo sectors and by
increasing the public funds entrusted to it
b)
“Board” means the Board of Directors of Loto-Québec
or any
of its subsidiaries
• Integrity and credibility: by demonstrating steadfast
vigilance to ensure the integrity, transparency and
credibility of the Corporation’s activities
c)
“executive” means any contractual manager whose
employment conditions are subject to the approval of
the Board
d)
“enterprise” means any form that can be taken by the
organization for the production of goods or services or
any other business of a commercial, industrial or
financial nature or any group seeking to promote
certain values, interests or opinions or to exercise an
influence on public officials; however this does not
include the Corporation or a non-profit association or
group that has no financial link with the Corporation
or is not incompatible with the objects of the
Corporation
• Expansion: by developing new markets through
associations and partnerships, which will allow it to
considerably enhance the traditional lottery games,
casinos and video lotteries it offers
e)
“subsidiary” means a wholly owned subsidiary of
Loto-Québec
f)
“Act” means the Act constituting the Société des loteries
du Québec, (R.S.Q. c. S-13.1), as amended from time
to time
g)
“Chairman of the Board” means the Chairman and
Chief Executive Officer of Loto-Québec
h)
“Corporation” means Loto-Québec
2 ETHICAL PRINCIPLES AND GENERAL RULES OF
PROFESSIONAL CONDUCT
2.1 This Code applies to the directors and executives of
the Corporation and its subsidiaries, who are bound
to comply with its provisions.
58
2.3 A director or executive shall, in the performance of his
or her duties, comply with the Corporation’s mission
and the following objectives:
2.2 A director or executive is appointed to contribute to
the achievement of the mission of the Corporation in
the best interest of Québec. Accordingly, he is
expected to use his knowledge, abilities, experience
and integrity in a way that will promote the fair and
efficient accomplishment of the objectives assigned to
the Corporation by the Act and the good administration
of the property it owns as mandatary of the State.
• Competence and expertise: by promoting the
development of the skills essential to the Corporation
and establishing programs that ensure respect for
human resources
• Social role: by expanding the ways of sharing the fruit
of its operations with the various communities and
regions and increasing its activities in the prevention
of compulsive gambling
2.4 A director or executive who, at the request of LotoQuébec or any of its subsidiaries, serves as director or
executive of another undertaking or company, or as a
member, is held to the same standards
2.5 A director or executive shall seek, in the performance
of his duties, only the interest of the Corporation to the
exclusion of his own interest or that of others
2.6 A director is required, in the performance of his or her
duties, to comply with the ethical principles and rules
of professional conduct prescribed by the Regulation
respecting the ethics and professional conduct of public
office holders; an executive is also required to respect
these rules to the extent that they are applicable to
him or her.
CODE
OF ETHICS
and Rules of Professional Conduct
3 DUTIES AND OBLIGATIONS OF DIRECTORS AND
EXECUTIVES WITH RESPECT TO CONFLICTS OF INTEREST
3.1
PREVENTION OF CONFLICTS OF INTEREST
3.1.1
A director or executive shall avoid placing himself
in a situation in which his or her personal interest is
in conflict with the duties of his or her position.
3.1.2
To be referred to by this Code, the interest held by
a director or executive in another enterprise must
be such that it is likely to conflict with the
performance of his or her duties within the
Corporation or any of its subsidiaries. A director or
executive who has an interest in an enterprise is in
a situation of “conflict of interest” in the following
cases, among others:
• if Loto-Québec or any of its subsidiaries has or is
likely to have a significant business relationship
with the enterprise, the significance of that
relationship being both for Loto-Québec and for
the enterprise
• if the enterprise is a listed company and its business
relationship with Loto-Québec or any of its
subsidiaries is likely to have an effect on listed
shares
• if the interest of the director or executive in the
enterprise that has a business relationship with
Loto-Québec or any of its subsidiaries, is such that it
may influence the enterprise’s affairs
3.2.2
A director or executive shall make the disclosure
required in section 3.2.1 as soon as he or she has
knowledge that he or she is in a conflict of interest
under sections 3.1.2 and 3.1.3. In the case of a
director, this disclosure of interest shall be recorded
in the minutes of the proceedings of the Board of
Directors of which he or she is a member.
3.2.3
A director or executive shall notify the Chairman of
the Board in writing of any rights that he or she
may invoke against the Corporation or any of its
subsidiaries, indicating their nature and value, as
soon as these rights come into existence or when
he or she acquires knowledge of them.
3.2.4
A director or executive shall also submit to the
Chairman of the Board, by June 1 of each year in
which he or she remains in office, an attestation in
the form provided.
3.2.5
The Chairman of the Board submits the attestations
referred to by these sections to the Secretary of the
Corporation, who keeps them at the disposal of the
members of the Board and the executives. The
attestations are treated as confidential.
3.3
WAIVER
3.3.1
This Code does not apply:
a) to owning securities when the size of the holding
probably does not place the director or executive in
a conflict of interest
• if the enterprise has signed a contract with LotoQuébec or any of its subsidiaries and this contract is
such that it has an impact on the enterprise’s assets
b) to owning an interest by way of a mutual fund in
whose management the director or executive plays
no role directly or indirectly
• if the enterprise is awarded a contract for which
the director or executive has been involved in the
choice of supplier
3.1.3
3.2
3.2.1
c) to owning interests through a blind trust whose
beneficiary may not know its make-up
d) to owning a minimum number of shares required
to be eligible as director of a corporation
A director who is party to a contract with LotoQuébec or any of its subsidiaries, or an executive
who is party to a contract with Loto-Québec or any
of its subsidiaries other than his or her contract of
engagement, is also considered to be in conflict of
interest.
e) to an interest which, by its nature and extent, is
common to the public at large or a particular sector
in which the director or executive operates
f) to a directors’ liability insurance agreement
g) to the owning of shares issued or guaranteed
by a government or municipality under the same
conditions for everyone
DISCLOSURE
AND ABSTENTION
A director or executive who:
a) has a direct or indirect interest in an enterprise
that places him or her in a situation of conflict of
interest under section 3.1.2 of this Code
4 EFFECTIVE DATE
4.1
This Code takes effect September 1, 1999.
or
b) is party to a contract with the Corporation or a
subsidiary under section 3.1.3
shall disclose the nature and extent of his or her
interest in writing to the Chairman of the Board; a
director shall also abstain from deliberating or
voting on any question linked to this interest and
avoid trying to influence the related decision; he or
she shall withdraw from the meeting while
deliberations and voting on this question continue.
59
HEAD OFFICE
500 Sherbrooke Street West
Montréal, Québec H3A 3G6
Tel.: (514) 282-8000
Fax: (514) 873-8999
Web Site:
http://www.loto-quebec.com
QUÉBEC CITY OFFICE
955, chemin Saint-Louis
Québec City, Québec G1S 4Y2
Tel.: (418) 686-7575
Fax: (418) 643-2690
REGIONAL CENTRES
MONTRÉAL AND
NORTHWESTERN QUÉBEC
Pierre Valcourt
Director of Sales
1945 Maurice-Gauvin Street
Laval, Québec H7S 2M5
Tel.: (450) 682-2525
1-800-361-9026
Fax: (450) 687-4818
MONTRÉAL AND SOUTHEASTERN QUÉBEC
Ginette Morin
LA SOCIÉTÉ DES CASINOS
DU QUÉBEC INC.
15th floor
Tel.: (514) 282-8080
Fax: (514) 864-1886
Web Site:
http://www.casinos-quebec.com
LA SOCIÉTÉ DES LOTERIES
VIDÉO DU QUÉBEC INC.
16th floor
Tel.: (514) 282-8090
Fax: (514) 864-3283
Web Site:
http://www.loterie-video.qc.ca
LA SOCIÉTÉ DES BINGOS
DU QUÉBEC INC.
12th floor
Montréal (Québec) H3A 3G6
Tel.: (514) 282-7777
Fax: (514) 864-7332
Web Site:
http://www.bingo-quebec.com
INGENIO, FILIALE
DE LOTO-QUÉBEC INC.
60
20th floor
Tel.: (514) 282-0210
Fax: (514) 282-2028
Web Site:
http://www.ingenio-quebec.com
Director of Sales
470, boul. Sainte-Foy
Longueuil, Québec J4J 1Y2
Tel.: (450) 928-7495
1-800-361-1244
Fax: (450) 928-7500
QUÉBEC CITY EASTERN QUÉBEC
Jean-Pierre Des Chênes
Director of Sales
955, chemin Saint-Louis
Québec City, Québec G1S 4Y2
Tel.: (418) 686-7575
1-800-463-4560
Fax: (418) 643-2690
Design: Vasco design international
To obtain additional copies of this report,
or for copies in French, please contact:
LOTO-QUÉBEC
Communications and Public Affairs
500 Sherbrooke Street West, 14th floor
Montréal (Québec) H3A 3G6
Tel: (514) 282-8000
The Annual Report may also be consulted on
Loto-Québec’s Web site at www.loto-quebec.com
The Loto-Québec Annual Report is a production
of the Vice-Presidency of Corporate Communications
and Public Affairs.
www.loto-quebec.com

societe des bingos du quebec inc

Transcription

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